Written by The Edge Financial Daily
Friday, 02 April 2010 07:54
KUALA LUMPUR: Blue chips may continue to advance on Friday, April 2 after starting off the second quarter on a firm note with the FBM KLCI at a 21-month high, while on Wall Street, the Dow and the S&P 500 closed at 18-month highs. However, with the weekend ahead, the gains could be held in check later in the day.
The Dow and the S&P 500 rose on Thursday, April 1 thanks to upbeat economic data, but the Nasdaq was stagnant as investors pummeled shares of Research In Motion following downbeat results, according to Reuters. Anxiety about Friday's March payrolls report held gains in check, according to Reuters.
The second quarter got off to a decent start for the stock market, with both the Dow and the S&P 500 closing at 18-month highs. The Dow Jones industrial average climbed 70.44 points, or 0.65 percent, to end at 10,927.07. The Standard & Poor's 500 Index rose 8.67 points, or 0.74 percent, to finish 1,178.10.
The Nasdaq Composite Index was the session's laggard, adding 4.62 points, or 0.19 percent, to 2,402.58.
At Bursa Malaysia, stocks to watch on Bursa Malaysia are HONG LEONG BANK BHD [], EON CAPITAL BHD [], Malaysia Airports Holdings Bhd (MAHB), MALAYSIAN RESOURCES CORP [] Bhd (MRCB), MULTI-PURPOSE HOLDINGS BHD [] (MPHB) and TAN CHONG MOTOR HOLDINGS BHD [].
Hong Leong Bank raised its offer for EON Capital’s Bhd's assets and liabilities to RM5.06 billion or RM7.30 per share from RM4.92 billion or RM7.10 per share previously. The revised offer valued EON Cap at 1.45 times book value and EON Cap has until until Monday whether to accept the offer.
“The Board of Directors of EON Capital will review the terms of such proposal and will make such further announcements as and when it has comprehensively reviewed the proposal and made a decision thereon,” said EON Cap, in reply to the revised offer.
Meanwhile, MPHB raised its stake in 3G licence holder, U Mobile Sdn Bhd, from 1.98% comprising 15 million shares to 6.33% comprising 48 million shares following a one-for-one rights issue and additional acquisition of shares. The shares have risen in active trade as analysts see more upside for the company which is venturing into property and it is also expected to gain from its improving gaming operations undertaken via Magnum.
MAHB expects its earnings before interest, taxes, depreciation and amortisation to rise to over RM1 billion and a return on equity of 10% at the end of its five-year business plan in 2014.
MAHB will focus on includes traffic growth, service excellence and commercial development. to drive future business growth. It also eyes an additional of RM822 million revenue by 2014, which 93% would be from commercial sources.
MRCB climbed to an intra-day high of RM1.72 on Thursday as investors expected it to take a more prominent role as the government moves to unlock the value of its land bank in the Klang Valley.
Affin Research on Wednesday raised the target price from RM1.77 to RM1.92 as it estimated that a one-third share in a RM5 billion development at a pretax margin of 20% would enhance MRCB’s realised net asset value by 17 sen, from RM1.92 currently to RM2.09.
Kenanga Investment Research has a hold on MRCB with a target price of RM1.50 and CLSA Asia Pacific Research has an outperform with a target price of RM1.80. The recommendations were issued on Wednesday.
Tan Chong Motor Holdings’s subsidiary ETCM (L) Pty Ltd has secured an agreement with Nissan Motor Co, Ltd (NML) for the sole and exclusive right to distribute completely built-up Nissan vehicles in Laos.
UBS AG has disposed of 10 million shares in BERJAYA LAND BHD [].