MALAYSIAeBiz Market Outlook JANUARY 31, 2015 MALAYSIAeBiz : Market Outlook For the local bulls, they will get their support closer For the week just ended, the ringgit went down to 3.6290/6320 against the US dollar from Friday’s back over 1,800 to hold the uptrend, Nazri said. 3.6015/6045. The previous Friday, it was traded As for stock picks, he said some quality stocks are at 3.55 level and ended the week at 3.5580/5610. “It could retrace back to near the 3.60 level next week on an improved risk appetite as a minimum bank to amend the overnight policy rate in the correction,” he told Bernama. very near term despite the Monetary Authority of Singapore’s move to ease its monetary stance on It should happen sooner if not due to the Monetary Wednesday while the US Federal Reserve hinted Authority of Singapore (MAS) move to ease its that it would stay the course towards increasing monetary stance by surprise, said another trader. rates. MAS’ decision has triggered additional ringgit’s short positions by speculators, he said. For next week, she said BNM is expected to continue to call for several money market tenders, The Singapore central bank on Wednesday had comprising conventional and Islamic, including surprised the markets by easing its policy to tackle commodity murabahah programme, range maturity deflation risks and support the island’s economy. auctions and repo tenders, on a daily basis. “MAS’ move boosted expectations that other central banks in Asia might follow suit and such For the week just ended, the BNM intervened daily expectations may drag the ringgit and other to flush the system of surplus. emerging Asian currencies to depreciate further in coming weeks,” he added. On Friday, the liquidity surplus in the conventional system amounted to RM17.58 billion while the Besides the MAS factor, the current market excess in the Islamic system stood at RM8.45 expectations were that the US Federal Reserve billion. would stay the course towards increasing rates as hinted in its latest policy statement, and this Following this, the central bank issued a late was supportive of the dollar’s rally against other conventional tender for RM17.60 billion and a late currencies. Al-Wadiah tender for RM6.60 billion, both for fiveday money. On a weekly basis, the ringgit was down against the Singapore dollar at 2.6872/6916 from last On a week-to-week basis, the benchmark threeFriday’s 2.6863/6905, its lowest level in 16 years. month KLIBOR inched down to 3.85 per cent from The local unit also eased against the yen to last week’s 3.86 per cent. 3.0825/0853 from 3.0439/0469 on Friday. Meanwhile, the overnight Islamic reference rate It was softer against the British pound at stood at 3.22 per cent, while the one-, two- and 5.4689/4745 from 5.3958/6021 as well as three-week rates stood at 3.28 per cent, 3.32 per against euro at 4.1156/1198 versus 4.0593/0634 cent and 3.36 per cent, respectively. last Friday. The market will be closed on Monday and Tuesday ......................................................................... for Federal Territory Day (replacement) and Thaipusam holidays. Money Market: Short-Term Rates Likely To Remain Stable ......................................................................... KUALA LUMPUR -- Short-term rates are likely to remain stable next week on Bank Negara Malaysia’s (BNM) intervention in the money market to absorb excess funds. A dealer said she does not anticipate the central © 2014 BERNAMA. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed in any form except with the prior written permission of BERNAMA. © 2014 BERNAMA. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed in any form except with the prior written permission of BERNAMA. LIST OF MARKET REPORTS : 1. Bursa Malaysia 2. Forex 3. Money Market 4. FBM KLCI Futures 5. Crude Palm Oil (CPO) Futures 6. Rubber Futures 7. KLIBOR Futures 8. Kuala Lumpur Tin Market (KLTM) 9. Gold Futures BURSA MALAYSIA BURSA: Shares To Trade Mixed Next Week By Mohd Iswandi Kasan Anuar well positioned for the continuity of 2015 Economic Transformation Programme policy. They include Tenaga Nasional, Sime Darby, DiGi, LPI Capital, Bursa Malaysia, QL Resource, Unisem, IJM Land, Mitra and Evergreen. Bursa Malaysia will be closed on Monday and Tuesday for the Federal Territory Day (replacement) and Thaipusam holidays. For the week just ended, the FBM KLCI declined 21.82 points to 1,781.26 from 1803.08 on Friday. Weekly turnover decreased to 9.74 billion units valued at RM11.07 billion from 11.32 billion units worth RM12.38 billion on Friday. Main market volume declined to 6.32 billion shares KUALA LUMPUR -- Bursa Malaysia is expected to worth RM10.31 billion from 7.65 billion shares trade mixed with easier buying next week on the valued at RM11.39 billion last week. back of stronger US dollar and declining oil prices. The Greece election results and mixed signals from ........................................................................ the US Federal Reserve (Fed) statement would also FOREX: Ringgit To Consolidate dent market sentiment, Affin Hwang Investment Next Week Bank Head of Retail Research Datuk Dr Nazri Khan By Azizul Ahmad said. “The biggest question mark in the markets is whether the Fed will start hiking rates, while many other central banks around the world are easing policy rates,” he told Bernama. KUALA LUMPUR -- The ringgit is expected to consolidate next week and retrace back to near the 3.60 level, but the case for further pressure remains. The benchmark FTSE Bursa Malaysia KLCI should test the uptrend channel support at 1,770, he said, adding that, a move below this key support would open the door for further aggressive selling. The ringgit has been traded over 700 hundred basis points lower for the past two weeks and it is time for a minimum correction, a currency chartist said. MALAYSIAeBiz : 1 MALAYSIAeBiz : 2 MALAYSIAeBiz : Market Outlook MALAYSIAeBiz : Market Outlook KLCI Futures Expected To Be Volatile Next On the physical market, February South fell RM110 to RM2,180 per tonne. Week KUALA LUMPUR -- The FTSE Bursa Malaysia KLCI (FBM KLCI) futures contracts (FKLI) on Bursa ..................................................................... Malaysia Derivatives are likely to be volatile next Uncertain Outlook For Rubber Prices Next week in line with equity markets, a dealer said. Week On a Friday-to-Friday basis, January 2015 declined KUALA LUMPUR -- The Malaysian rubber market 21 points to 1,787, February 2015 slipped 28 is expected to be uncertain next week due to lower points to 1,778, March 2015 decreased 32 points buying interests coupled with weaker crude oil to 1,773.5 and June 2015 fell 35 points to 1,769. prices. Turnover for the week increased to 90,460 lots “The market will be quiet as traders trim their from 47,371 lots last week while open interest position due to the long holiday,” a dealer said. narrowed to 44,721 contracts from 49,489 The commodity market will be closed on Monday contracts previously. and Tuesday for the Federal Territory Day and For the week just ended, the benchmark FTSE Thaipusam holidays. Bursa Malaysia KLCI (FBM KLCI) was 0.92 of a On a Friday-to-Friday basis, the Malaysian Rubber point lower at 1,781.26. Board’s official physical price for tyre-grade SMR ......................................................................... 20 fell half-a-sen to 496.5 sen a kg and latex-inbulk declined nine sen to 361.5 sen a kg. CPO Futures To Trade Between RM2,070The unofficial closing price for tyre-grade SMR 20 RM2,160 KUALA LUMPUR -- Crude palm oil (CPO) futures lost five sen to 491 sen a kg and latex-in-bulk fell contracts on Bursa Malaysia Derivatives are likely nine sen to 360 sen a kg. to trade between RM2,070 and RM2,160 a tonne ....................................................................... next week on a short trading period. Interband Group of Companies Senior Palm Oil Trader Jim Teh said the trading market would be closed on Monday and Tuesday for public holidays, with the market expected to be quiet for the rest of the week. KLIBOR Futures To Remain Lacklustre Next Week KUALA LUMPUR -- The three-month Kuala Lumpur Interbank Offered Rate (KLIBOR) futures contracts on Bursa Malaysia Derivatives are likely to remain lacklustre next week. On a Friday-to-Friday basis, February 2015 fell RM110 to RM2,154, March 2015 slipped RM97 to For the week just-ended, no contract was traded RM2,150, April 2015 fell RM84 to RM2,146 and throughout the week and open interest remained unchanged at 1,320 contracts. May 2015 dropped RM80 to RM2,132 a tonne. Weekly turnover rose to 272,867 lots from 250,380 lots last week while open interest increased to 233,922 contracts from 217,446 contracts, previously. Spot month February 2015 remained pegged at 96.15, while March 2015, April 2015 and June 2015 were pegged at 96.18, 96.18 and 96.17, respectively. © 2014 BERNAMA. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed in any form except with the prior written permission of BERNAMA. MALAYSIAeBiz : 3 The underlying three-month KLIBOR inched down Gold Futures Likely To Remain Bearish Next Week to 3.85 per cent from last week’s 3.86 per cent. KUALA LUMPUR -- Gold futures contracts on Bursa The market will be closed on Monday and Tuesday Malaysia Derivatives are likely to remain bearish for the Federal Territory Day (replacement) and next week amid concern over the US interest rates hike, said dealers. Thaipusam holidays. He said market participants would be focusing on the US fourth quarter gross domestic product data Tin Price To Stay At Current Level Next Week to be released on Friday to dictate their buying KUALA LUMPUR -- Tin price on the Kuala Lumpur strategy. Tin Market (KLTM) is likely to stay at the current level following the strengthening of the US dollar, Another dealer said the local market would likely remain quiet next week due to the long weekend. a dealer said. Gold trading on Bursa Malaysia Derivatives will He expects foreign and local buyers to remain be closed on Monday and Tuesday for the Federal active in the coming week with the commodity likely Territory Day (replacement) and Thaipusam to trade between US$19,100 and US$19,300 per holidays. tonne. On a Friday-to-Friday basis, January declined 52 As usual, the local tin market is also expected to ticks to RM147.40 a gramme and February 2015 take cues from movements on the London Metal was 45 ticks lower at RM148.35 a gramme. Exchange (LME). March 2015 and April both fell 47 ticks to The local tin market will be closed on Monday RM148.75 a gramme and RM149.20 a gramme, and Tuesday for the Federal Territory Day and respectively. Thaipusam holidays. Volume for the week eased to 735 lots worth During the week just-ended, the local tin price was RM10.96 million from 843 lots worth RM16.4 million last week. traded mostly lower on lack of strong buying. ....................................................................... On a Friday-to-Friday basis, the KLTM tin price was Open interest on Friday was lower at 2,938 slightly lower at US$19,200 per tonne compared contracts against last week’s 3,399 contracts. with US$19,300 per tonne last Friday. Total turnover on the KLTM went down to 290 tonnes from 303 tonnes last week, with activities dominated by European, Japanese and local traders. ......................................................................... The price differential between the KLTM and LME widened to US$375 from US$140 last week. .......................................................................... © 2014 BERNAMA. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed in any form except with the prior written permission of BERNAMA. MALAYSIAeBiz : 4