Blue chips shake off initial hesitation

KUALA LUMPUR: Blue chips advanced in early trade on Tuesday, April 6 with Tenaga and RHB Cap among the gainers after the initial hesitation following some mild profit taking after the FBM KLCI hit a fresh two-year high on Monday.

At 9.42am, the FBM KLCI was up 0.87 of a point to 1,342.62. Turnover was 178.48 million shares valued at RM162.47 million. There were 204 gainers, 166 losers and 199 stocks unchanged.

Hwang DBS Vickers Research said with major U.S. barometers on Wall Street (up between 0.4% and 1.1% on Monday night) closing at fresh highs since the stock market recovery started in March last year, the momentum for Asian equities remains on the upside for now.

“So we can expect the benchmark FBM KLCI to climb further ahead. The bellwether may attempt to inch up bit by bit, possibly pulling away from the 1,340 resistance threshold by a slight margin today.

“This is also currently the case on the derivatives exchange, as the spot month FBM KLCI futures contract is hovering at 1,346, a 4.3-point premium over the underlying index level,” it said.

Hwang DBS Vickers Research said given the positive stock market outlook, risk-taking investors could be attracted to structured warrants, which are regarded as bull market instruments.

Four new European-styled call warrants listed on Tuesday are Berjaya Corporation CW (exercise ratio of 2 warrants-to-1 share, exercise price of RM1.60); (b) Wah Seong CW (exercise ratio of 3 warrants-to-1 share, exercise price of RM2.65); (c) Annjoo CW (exercise ratio of 4 warrants-to-1 share, exercise price of RM2.60); and (d) Genting Singapore CW (exercise ratio of 3 warrants-to-1 share, exercise price of 90 cents).

At Bursa Malaysia, Panasonic Malaysia extended its gains, adding 80 sen to RM17 while F&N added 36 sen to RM10.96.

Tenaga rose 16 sen to RM8.29 with 568,000 shares done. AmResearch reiterated its BUY call on TENAGA NASIONAL BHD [] with a higher fair value of RM10.00 a share.

“We expect Tenaga's 2QFY10 results, which will be announced on 29 April 2010, to be stronger than expected due to a sharp rebound in electricity demand growth while coal costs remain under control,” it said.

RHB Cap rose 12 sen to RM5.89, Ann Joo 12 sen also to RM2.96 while Tanjung Offshore added 11 sen to RM1.15.

BCorp-CB was the most active with 16.2 million units done, rising 7.5 sen to 23 sen on the trading debut while Ann Joo-CA added seven sen to 22 sen.

CIMB fell six sen to RM14.68 on mild profit taking. MHC was the top loser, down 20 sen to RM1.10. Analabs, which rallied last Friday, slipped six sen to RM1.60. Ho Hup shed 4.5 sen to 71.5 sen and KKB four sen lower at RM6.40.