Written by Joseph Chin
Tuesday, 27 July 2010 08:04
KUALA LUMPUR: With the FBM KLCI managing to close at its highest since February 2008 on Monday, July 26, all eyes will be on whether there would be continuing buying on index-linked stocks on Tuesday.
The KLCI futures closed one point higher at 1,355 on Monday, while the KLCI closed at 1,351.82, underpinned by strong gains in CIMB. However, the broader market was mixed.
On Wall Street, an upbeat outlook from FedEx, coupled with encouraging home sales, lifted U.S. stocks on Monday, keeping the S&P 500 above 1,100 for a second day and suggesting the rally could last.
Reuters said a surprising 23.6% jump in new home sales in June from May countered some disappointing data in recent weeks that had increased concerns the economy may slip back into recession.
The Dow Jones industrial average gained 100.81 points, or 0.97%, to 10,525.43. The Standard & Poor's 500 Index rose 12.35 points, or 1.12%, to 1,115.01. The Nasdaq Composite Index advanced 26.96 points, or 1.19%, to close at 2,296.43.
Stocks to watch on Tuesday include banks, which are a proxy for the outlook of the economy and market, PJ Development Bhd, KKB Resources Bhd, GPRO TECHNOLOGIES BHD [] and KENMARK INDUSTRIAL CO. (M) BHD [].
CIMB Group was upbeat about its prospects for Indonesia after it received shareholders' nod to buy up to a 19.67% stake in Indonesia's PT Bank CIMB Niaga TBK.
CIMB Group CEO Datuk Nazir Razak said the group would step up to expand its services in Indonesia. Among the plans were to improve various segments of its business in Indonesia. Initiatives include expanding its microfinance, auto-finance, credit card, priority banking, investment banking and corporate banking businesses under CIMB Niaga.
Mudajaya could continue to see selling pressure for the second day despite the company’s statement that it was not directly queried by the Securities Commission.
PJ Development proposed a renounceable rights issue of up to 213.81 new warrants on the basis of three new warrants for every eight shares held.
It also proposed a restricted issue of up to 42.76 million new warrants to the holders of unexercised 2000/2010 warrants on Oct 29, 2010. This would be on the basis of three new warrants for every eight unexercised 2000/2010 warrants.
KBB Resources was designated as an affected listed issuer pursuant to Practice Note No 1/2001 (PN1) of the Main Market listing requirements of Bursa Malaysia Securities due to repayment default.
GPRO plans to acquire precision casting and injection moulding specialist AB TECHNOLOGY [] Sdn Bhd (AB Tech)at an indicative price of RM140 million. The proposed acquisition would be fully satisfied by the issuance of new GRPO shares at an issue price of 10 sen each.
The acquisition of AB Tech would transform GPRO into a producer of high precision casting and injection moulding of various advance metals and resins.
Kenmark Industrial Co. (M) Bhd faces suspension on Aug 9 after its application for more time from Bursa Malaysia Securities to issue the audited financial statements for FY ended March 31, 2010 (AFS 2010) was rejected.
It said the directors were unable to advise at this juncture as to when the AFS 2010 can be finalised or issued but will endeavour to have the same issued as soon as possible.
BOUSTEAD HEAVY INDUSTRIES CORP []oration Bhd said its associate company, Boustead Naval Shipyard Sdn Bhd (BNS), was served with a Writ of Summons by Maraputra Sdn Bhd.
Under the writ of summons, Maraputra is claiming against BNS for damages totaling RM10.36 million, interest at 8% per annum on the RM10.36 million, cost and other relief the court deems fit, arising from a contract dispute between Maraputra and BNS.
BNS is disputing the amount claim and is preparing a statement of defence and counter-claim against Maraputra. The board said it BNS has a good defence to these claims by Maraputra.