Despite the rally on Wednesday, Oct 5, which enabled the FBM KLCI to snap two days of losses, investors are expected to stay on the sidelines until the economic outlook of the US and Europe is on a much firmer footing.
A one-day rally, led by local funds, would not be enough to convince investors to start bottom fishing unless there is a more solid recovery overseas.
However, expectations of positive news from the Budget 2012 proposals could galvanise sentiment at least in the medium term.
In a recent report, RHB Research Institute said it expected the market volatility to continue. Its top picks, mainly include companies with stable cash flows, as well as those with above-market dividend yields, and thus reflect a more cautious stance.
“However, we also believe that the Government will likely accelerate execution of ETP projects, hence the inclusion of Gamuda in our list. Our back-test analysis shows that our top picks tend to outperform the benchmark index during market downturns (e.g. 2008) and at least perform in line during market upturns,” it said.
RHB Research said year-to-date, some sectors underperformed due to global macroeconomic issues (semicon, banks, transport), while others were affected by domestic issues (construction, building materials), cyclical reversals (oil & gas, plantation and timber), and specific issues (utilities and motor).
“Three sectors outperformed for the YTD including media (+5.4%), insurance (+8.7%) and telecom (+16.4%). For each sector, the star performers were MCIL (+20.9%), Kurnia Asia (+26.7%), MNRB (+12.6%), DiGi (+28.9%) and TM (+31.3%),” it said
Among the stocks to watch on Thursday are Mah Sing Group Bhd, plantations, Masterskill Education Group Bhd (MEGB), UEM Land Holdings Bhd and Rexit Bhd.
Mah Sing plans a lifestyle township in Rawang with an estimate gross development value (GDV) of RM948 million.
It was acquiring Semai Meranti Sdn Bhd which owns 225.7 acres of freehold within the Northern Growth Corridor in Rawang, for RM57 million.
“The land will be developed into a lifestyle township with an estimated GDV of approximately RM948 million, offering beginner homes priced from RM390,000,” it said.
Plantations would continue to be weighed down by weaker crude palm oil futures which had fallen to more than a year’s low. CPO for third-month delivery fell RM25 to RM2,785 on Wednesday.
Over the past few days, plantations were among the major losers. On Wednesday, PPB fell 30 sen to RM15.76, United Plantations 28 sen to RM17.20, BLD Plantations 20 sen to RM5.60, KLK 16 sen to RM20.
In Masterskill Education Group Bhd (MEGB), Siva Kumar s/o M. Jeyapalan has emerged as a substantial shareholder in the education group. A filing showed he acquired 41.20 million shares or a 10.05% stake on Wednesday.
The Inland Revenue Board has notified UEM Land Holdings Bhd’s unit Bandar Nusajaya Development Sdn Bhd (BND) to pay RM73.836 million as additional tax and penalty for the year of assessment 2006.
It said BND has started the appeal process against the additional assessment.
“After taking into account the various advice from the consultants, the company believes that the grounds for the appeal are valid and hence no additional provision for income tax has been made by the company,” UEM Land said.
In Rexit Bhd, Chia Kwoon Meng has emerged as a substantial shareholder with 9.813 million shares or 5.3%. A filing showed he acquired the shares on Sept 7.
Interestingly, he ceased to be a substantial shareholder of Fututech Bhd after he disposed of 2.58 million shares in the open market on Sept 23.
A one-day rally, led by local funds, would not be enough to convince investors to start bottom fishing unless there is a more solid recovery overseas.
However, expectations of positive news from the Budget 2012 proposals could galvanise sentiment at least in the medium term.
In a recent report, RHB Research Institute said it expected the market volatility to continue. Its top picks, mainly include companies with stable cash flows, as well as those with above-market dividend yields, and thus reflect a more cautious stance.
“However, we also believe that the Government will likely accelerate execution of ETP projects, hence the inclusion of Gamuda in our list. Our back-test analysis shows that our top picks tend to outperform the benchmark index during market downturns (e.g. 2008) and at least perform in line during market upturns,” it said.
RHB Research said year-to-date, some sectors underperformed due to global macroeconomic issues (semicon, banks, transport), while others were affected by domestic issues (construction, building materials), cyclical reversals (oil & gas, plantation and timber), and specific issues (utilities and motor).
“Three sectors outperformed for the YTD including media (+5.4%), insurance (+8.7%) and telecom (+16.4%). For each sector, the star performers were MCIL (+20.9%), Kurnia Asia (+26.7%), MNRB (+12.6%), DiGi (+28.9%) and TM (+31.3%),” it said
Among the stocks to watch on Thursday are Mah Sing Group Bhd, plantations, Masterskill Education Group Bhd (MEGB), UEM Land Holdings Bhd and Rexit Bhd.
Mah Sing plans a lifestyle township in Rawang with an estimate gross development value (GDV) of RM948 million.
It was acquiring Semai Meranti Sdn Bhd which owns 225.7 acres of freehold within the Northern Growth Corridor in Rawang, for RM57 million.
“The land will be developed into a lifestyle township with an estimated GDV of approximately RM948 million, offering beginner homes priced from RM390,000,” it said.
Plantations would continue to be weighed down by weaker crude palm oil futures which had fallen to more than a year’s low. CPO for third-month delivery fell RM25 to RM2,785 on Wednesday.
Over the past few days, plantations were among the major losers. On Wednesday, PPB fell 30 sen to RM15.76, United Plantations 28 sen to RM17.20, BLD Plantations 20 sen to RM5.60, KLK 16 sen to RM20.
In Masterskill Education Group Bhd (MEGB), Siva Kumar s/o M. Jeyapalan has emerged as a substantial shareholder in the education group. A filing showed he acquired 41.20 million shares or a 10.05% stake on Wednesday.
The Inland Revenue Board has notified UEM Land Holdings Bhd’s unit Bandar Nusajaya Development Sdn Bhd (BND) to pay RM73.836 million as additional tax and penalty for the year of assessment 2006.
It said BND has started the appeal process against the additional assessment.
“After taking into account the various advice from the consultants, the company believes that the grounds for the appeal are valid and hence no additional provision for income tax has been made by the company,” UEM Land said.
In Rexit Bhd, Chia Kwoon Meng has emerged as a substantial shareholder with 9.813 million shares or 5.3%. A filing showed he acquired the shares on Sept 7.
Interestingly, he ceased to be a substantial shareholder of Fututech Bhd after he disposed of 2.58 million shares in the open market on Sept 23.
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