OSK’s earlier suspicion that bearish view on the market may not survive February turned out correct as the KLCI took the cue from the DJIA to rally past its resistance level at 1565 pts for a 3.2% gain in the month.
Nonetheless, OSK remains unconvinced that this liquidity fueled rally is supported by strong fundamentals and still see a risk of market correction.
However, OSK set year-end KLCI target at 1620 pts and upgrade our market call to NEUTRAL. OSK recommends a more balanced portfolio that includes Defensives in the Consumer and Telco sector as well as Cyclicals in the Construction, Oil & Gas and Banking sectors as Top Buys given the improved news flow going forward.
The table below is the target price for OSK’s March 2012 top picks.
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Majority the stock market in the world does not performing well in 2011 with only 7 out of 51 stock markets showing an increase in the market capitalization.
This included Bursa Malaysia with 0.48% market capitalization. However, it is in the top 10 of the world’s best-performing stock market in 2011.
The top 2 world’s best-performing stock markets are Irish with 86 percent increase in market capitalization. Meanwhile, the worst stock exchanges are Cyprus and Athens stock exchanges, which decrease more than 40 percent.
The table below is world stock exchange rank for year 2011.
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As jobs visibility improves, 2012 should generally be a better year for the Malaysian O&G industry compared to 2011. This year and next year’s focus should still be on marginal oilfields. OSK expects the overlap of marginal oilfield and deepwater activities to boost O&G services providers’ utilization rates to their peaks.
The development of onshore O&G projects would also continue to hog the headlines moving forward.
OSK Maintains Overweight on the sector, with Kencana Petroleum and Dialog Group being the top picks.
Below are the target prices and ratings for selected Oil & Gas stock.
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As the much anticipated 13th general election draws near, OSK see the Government dishing out more contracts to create a “feel good” climate in the run-up to the polls.
News relating to mega projects such as the KL MRT, WCE, EDT and potentially SCORE, should gain traction and hence present investors – who are increasingly becoming more upbeat – with trading opportunities aplenty.
As such, OSK upgrade our sector call from Neutral to OVERWEIGHT as the rush of positive news in the next few months is likely to fire up the sector to new highs this year.
Below are the target price, market capitalization and rating for selected stocks in construction sector.
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China Stationery Limited Initial Public Offering (IPO) did not received a good response response of their public portion of 60 million shares. The subscription rate was only 50 percent.
The IPO attracted 2,836 applications or 29.88 million shares. The remaining unsubscribed 30.1 million shares relocated to the private placement.
In addition, 163 million shares made available for private placement to identified investors have been placed out.
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