Stocks to watch: Plantations, O&G, TSR Cap, Glomac

Tags: Glomac | O&G | Plantations | TSR Cap

Written by Chong Jin Hun
Tuesday, 29 September 2009 07:34

KUALA LUMPUR: Asian markets including Bursa Malaysia could trade on a more positive note on Tuesday, Sept 29 after the overnight rally on Wall Street, enabling US stocks to snap a three-day losing streak.

A spurt of corporate takeovers in the TECHNOLOGY [] and health-care sectors fuelled optimism about share values, according to Reuters. Mergers and acquisitions are typically viewed as bullish as it suggests companies are more optimistic about the business outlook.

The Dow Jones industrial average rose or 1.28% to end at 9,789.36. The Standard & Poor's 500 Index gained 1.78% to 1,062.98. The Nasdaq Composite Index shot up 1.9% to 2,130.74.

At Bursa Malaysia, PLANTATION []s, and oil and gas (O&G) companies could take their cue from weaker commodity prices as crude oil prices fall in anticipation of weaker demand amid high inventory.

Palm oil rates tend to move in tandem with crude oil prices as costlier hydrocarbon energy prompts demand for palm oil as feedstock for production of biodiesel, a cheaper alternative.

"(Crude) Oil may find some support at USD58," SJ Securities wrote in a note. Malaysian palm oil for November delivery fell RM86 to RM2,115 a tonne yesterday while crude oil for the same month was traded at some US$66 a barrel, down from about US$72 seen last week.

Yesterday, shares of plantation firms IOI Corp Bhd lost 11 sen to RM5.23 while SIME DARBY BHD [] fell six sen to RM8.52. O&G process equipment maker KNM GROUP BHD [], the most actively traded stock, shed 2.5 sen to 76 sen.

CONSTRUCTION [] stocks AHMAD ZAKI RESOURCES BHD [] (AZRB) and TSR CAPITAL BHD [] could see trading interest on fresh corporate developments.

AZRB confirmed a report in The Edge Financial Daily that it had bid for a RM50 million job for the Hulu Terengganu hydroelectric project.

"At this stage, we can confirm that we have bid for the project but at present no letter of award has been secured with respect to the works mentioned in the said article," AZRB said.

TSR Capital secured an RM80 million job to build Phase 3A of the Space Technology Facility within the National Space Centre in Banting, Selangor.

A 6.12% block of shares in property developer GLOMAC BHD [], believed to be treasury shares, were traded off-market on Sept 28 at RM1.098 apiece.

Glomac posted net profit of RM8.34 million for the first quarter ended July 31, 2009, up from the RM7.8 million a year ago. On a pre-tax level, it was up 57% at RM16.47 million versus RM10.5 million a year ago.

As for AmcorpGroup and AMDB, the latest development was that Tan Sri Azman Hashim's AmcorpGroup Bhd's offer for sale of 119.8 million shares in a restructured AMDB BHD [] met with a cold reception as only 7.19% of the total shares offered were accepted.