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Friday, September 29, 2017

MRCB: Cheap Enough?

MRCB is an integrated transport hub developer. Since the successful completion of its KL Sentral CBD development, it has expanded its projects to include PJ Sentral, Kwasa Damansara & Penang Sentral. For more on its projects, go to here

To finance its mega projects, MRCB has proposed a 1-for-1 Rights Issue at 79 sen which comes with 1 free warrant for every 5 shares subscribed for. The exercise price for each warrant is fixed at RM1.25. For details of the fixing of the Rights Issue & warrant exercise price, go here. The Rights issue has prompted a sharp drop in MRCB share price from RM1.75 in May to as little as RM1.01 on Sep 26 & 27.

Kenanga has maintained a fairly positive view on MRCB, valuing MRCB at RM1.14 after the Rights issue. Assuming that MRCB closed at RM1.03 today (the last cum date), the theoretical ex-Rights price is about RM0.97. This gives MRCB an upside of about 17%. I feel that Kenanga's fair value is too conservative, probably due to market reality.

Based on the sharp drop in share price over the past 4 months, I believe MRCB is a good stock for long-term investment. You can either buy MRCB today and then go through with the Rights issue or buy it after the Rights issue when further "massaging" may throw out even lower prices. Good luck!


Chart 1: MRCB's daily chart as at Sep 28, 2017 (Source: Shareinvestor.com)


Chart 2: MRCB's monthly chart as at Sep 28, 2017 (Source: Shareinvestor.com)

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Thursday, September 28, 2017

VS: Earnings Dropped q-o-q

Result Update

For QE31/7/2017, VS's net profit dropped 27% q-o-q but rose 236% y-o-y to RM37 million while revenue rose 15% q-o-q or 77%  y-o-y to RM983 million. VS's profits dropped q-o-q mainly attributable to lower gross profit margin resulting from weakening of US Dollar against Ringgit Malaysia. In addition, profits decline was aggravated by impairment loss on property & other investment of RM12.0 million and RM4.0 million respectively.


Table: VS's last 8 quarterly results


Graph: VS's last 50 quarterly results

Valuation

VS (closed at RM2.53 yesterday) is trading at a trailing PE of 19.1 times (based on last 4 quarters' EPS of 13.22 sen). At this PER, VS is deemed fairly valued.

Technical Outlook

VS had a strong rally after it broke above the horizontal line at 14 sen in 2014. It consolidated for a year in 2016 and broke above the horizontal line at RM1.60 in late January this year and then rallied to a recent high of RM2.68. All indications are this rally may continue.


Chart 1: VS's weekly chart as at Sep 27, 2017 (Source: MalaysiaStock.Biz)

VS is very well supported by either the 10 or 20-day SMA lines. You may use these lines to gain entry into the stock. That levels will be around RM2.40 mark in the next few weeks.

 
Chart 2: VS's daily chart as at Sep 27, 2017 (Source: MalaysiaStock.Biz)

Conclusion

Despite the drop in earning last quarter, VS is a good stock for long-term investment based on steady financial performance & positive technical outlook, Even though earning lagged the sharp rise in revenue, I believe earning may soon catch up. Thus, I revise my rating from SELL INTO STRENGTH to BUY ON WEAKNESS.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Wednesday, September 27, 2017

YTLPOWER: Who's Afraid Of Dividend?!

I was getting ready to post on YTLPower dividend play for the past few days. I held back after seeing what happened to Star right after its dividend entitlement went ex. That plus the non-action in KPJ's 1-to-5 share split seem to suggest that the market is non-responsive to management reward- a big change from the days of over-enthusiastic response we had seen in 6 months ago.

Nonetheless the logic behind YTLPower dividend play remains. In the chart below, I have listed down the past 3 years dividend payout and the upcoming payout in early September. Past dividend payouts had been announced in late August & carried out in October. The current one will go ex on October 24, and it consists of a 5-sen dividend and a treasury share distribution of 1-for-50. If you valued the Treasury share at RM1.37 each, the entire dividend will be worth about RM77 (or 7.7 sen per share).

Note the following:
1) YTLPower share price has dropped ahead of the current dividend
2) YTLPower is now trading at the uptrend line support

So, the plan is to own the stock in order to get the 7.7 sen dividend and the possible rebound in the share price of about 15-sen towards the upper line, RR.


Chart: YTLPower's weekly chart as at Sep 27, 2017_4.15 (Source: Malaysiastock.biz)

STAR: A Costly Dividend

Star went ex today for first interim and special dividends totaling 36 sen. Yesterday, it dropped 6 sen ahead of the dividend ex date. It closed at RM2.30. After deducting the 36-sen dividend, Star's reference price is RM1.94. Amazingly Star is now trading at RM1.80 as at 3.20pm. This means that a shareholder who held the stock for the dividend received 36-sen dividend but is down 50 sen.    

It is worth highlighting that the selldown is overdone notwithstanding the competitive nature of the media business, etc. Chartwise, we can see that the share price is trading just below its long-term uptrend line (in blue) at RM1.85 as well as the line connecting the last 2 years' troughs (in orange) at RM1.80. I won't be surprised that the stock may see a 10-15 sen rebound over the next few days.

Assuming Star continues with its twice yearly dividend of 9 sen each (or, 18 sen in total), its dividend yield is now a whopping 10%.


Chart 1: Star's weekly chart as at Sep 27, 2017_3.20pm (Source: Malaysiastock.biz)


Chart 2: Star'smonthly chart as at Sep 27, 2017_3.20pm (Source: Malaysiastock.biz)

Crude Oil Recovery Began?

Crude oil has revisited its January 2017 high of USD58 last 2 days. If it can break above this level as well as the psychological USD60 mark, crude oil price is likely to continue its upleg. 

What is more amazing than the strong recovery in crude oil price is the change of tune of among the pundits. Citibank came out with an article highlighting the potential oil squeeze in 2018! Goldman Sach demand forecast for oil is also now being questioned! Notwithstanding the bullish calls, crude oil recovery hinges on successful breakout above USD60.


Chart 1: Brent's daily chart as at Sep 26, 2017 (Source: Stockchart.com)

In a market that is deprived of trading ideas, the rally in crude oil price has not gone unnoticed. In the past few days, we have seen sharp rally among the penny O&G stocks. I have appended below the charts of some spectacular rally. You can see that some are knocking on resistance. Be careful!


Chart 2: Hibiscus's daily chart as at Sep 26, 2017 (Source: Malaysiastock.biz)


Chart 3: Reach's daily chart as at Sep 26, 2017 (Source: Stockchart.com)


Chart 4: Carimin's daily chart as at Sep 26, 2017 (Source: Stockchart.com)


Chart 5: Icons' daily chart as at Sep 26, 2017 (Source: Stockchart.com)

Note: I am using Brent chart because I have concern about WTIC price movement after the recent 2 hurricanes had hit oil installations in the region. 

Market Outlook as at September 26, 2017

FBMKLCI made a high of 1793 on September 13. Since then, it has been sliding and yesterday, it made a low of 1761. It seems to have formed an irregular triangle, with the upper line acting as a resistance at 1792-1793 and the lower line acting as support at 1759-1760. A breakout on the downside would convert this likely continuation pattern into a reversal pattern; by simply hanging a sign that reads double top reversal in place of triangle. However I am leaning towards a triangle- expecting the market to stabilize next few days and recovery to kick in after that. See Chart 1 & 2 below.


Chart 1: FBMKLCI weekly chart as at Sep 26, 2017 (Source: Shareinvestor.com)


Chart 2: FBMKLCI daily chart as at Sep 26, 2017 (Source: Shareinvestor.com)

Until the blue chip stocks have sorted out their next price direction, the play has now shifted to the 2nd liner stocks (in FBM70) and 3rd liner stocks (in FBMSCAP & FBMFLG). From the next 3 charts, you can see that these indices have broken above their respective intermediate downtrend lines.


Chart 3: FBM70 weekly chart as at Sep 26, 2017 (Source: Shareinvestor.com)


Chart 4: FBMSCAP weekly chart as at Sep 26, 2017 (Source: Shareinvestor.com)


Chart 5: FBMFLG weekly chart as at Sep 26, 2017 (Source: Shareinvestor.com)

As noted last week, I believe the play in the tech sector is probably due for correction. We saw a bit of that in the price pullback for semiconductor stocks.


Chart 6: FBMACE weekly chart as at Sep 26, 2017 (Source: Shareinvestor.com)

One bit of information that may be useful in gauging whether the market still has more room to go or due for a deeper dive is the information of weekly inflow of foreign fund into Malaysian equity. This information is published on a weekly basis by The Edge Daily, and it is sourced from Bursa Malaysia. I have combined the FBMKLCI weekly chart with the foreign fund flow since January 2016 below. It shows that the foreign fund inflow had coincided with the sharp rally in Mar, April & May. This inflow has not left our shore yet. That explains the shallow correction in FBMKLCI.


Chart 7: FBMKLCI weekly chart as at Sep 26, 2017 & Foreign Fund Flow (Source: Shareinvestor.com & Bursa Malaysia, via The Edge Daily)

Based on the above, I think you can nibble into beaten blue chip stocks and trade breakouts among the 2nd and 3rd liner stocks but avoid tech stocks for a while. Good luck!

Superln: Earnings Dropped q-o-q

Result Update

In QE31/7/2017, Superln's net profit dropped by 44% q-o-q or 42% y-o-y to RM3.6 million while its revenue dropped 19% q-o-q but rose 3% y-o-y to RM26 million. Revenue decreased q-o-q due to lower export demand and less favorable exchange rate movement. Profits dropped q-o-q mainly due to the decrease in total gross profit generated from lower volume of sales and higher cost of materials. The lower other income recorded and higher other operating expenses also contributed to decrease in net profit before tax.


Table: Superln's last 8 quarters' results


Graph: Superln's last 18 quarters' results

Valuation

Superln (closed at RM2.76 yesterday) is now trading at a trailing PER of 20.7x (based on last 4 quarters' EPS of 13.36 sen). At this PER, Superln is deemed fairly valued.

Technical Outlook

Superln is in an uptrend since 2014. With the MACD hooked down, Superln is likely to consolidate its price gain.


Chart 1: Superln's weekly chart as at Sep 26, 2017 (Source: Malaysiastock.biz)

If we compare the share price movement & the profit trend, it appears that share price is running ahead of earning. Superln is likely to experience a price reversal unless earning quickly rebounds back. Unfortunately we will have to wait for the next quarterly result to find out whether this will happen.


Chart 2: Superln's weekly price chart and profits trend for the past 4 years

Conclusion

Based on weaker financial performance and substantial price rally, it is advisable to take some profit for your investment in Superln. Thus, I rate Superln as a SELL INTO STRENGTH.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Monday, September 25, 2017

BJToto: Earning Rebounded


Result Update

For QE31/7/2017, BJToto's net profit rose 2.5% q-o-q or 26.5% y-o-y to RM72 million while revenue was mixed - down 0.4% q-o-q but up 2.5% y-o-y - to RM1.47 billion. Overall revenue dropped q-o-q mainly due to lower revenue reported by Sports Toto and PGMC. The drop was mitigated by higher revenue growth achieved by H.R. Owen which was due to higher revenue achieved from used car sales. The Group registered an increase in pre-tax profit of 15.0% mainly attributable to the improved results reported by Sports Toto and H.R. Owen.


Table : BJToto's last 8 quarterly results

Revenue jumped in QE31/1/2014 due to the consolidation of H.R. Owen's revenue onto the Group's account. Despite the sharply higher revenue, the Group's bottom-line remained flat as the H.R. Owen's profits were not significant.


Graph: BJToto's last 52 quarterly results

Financial Position

BJToto's finaial position as at 31/1/2017 is deemed adequate, with current ratio at 1.03x while gearing ratio at 2.15x.

Valuation

BJToto (closed at RM2.36 last week) is now trading at a PER of 12.4 times (based on last 4 quarters' EPS of 19.06 sen). Its dividend payment for the preceding 4 quarters amounted to 14 sen; giving the stock a dividend yield of 5.9%. At these PER & DY, BJToto is deemed fairly attractive.

TA Securities has valued BJToto at RM3.34 based on Dividend Discount Model, with CAPM rate of 10.20%. This gives the stock a potential upside of 41.5%. If you want to read the report, go here.

Technical Outlook

In April, BJToto broke below the irregular trading range, ABCD at RM2.60 and dropped to a low of around RM2.25. Since the release of the latest quarterly result, BJToto has rebounded back above RM2.30. While the downside momentum has begun to weaken, it is still too early to call a bottom for the stock.


Chart 1: BJToto's weekly chart as at Sep 21, 2017 (Source: Malaysiastock.biz)


Chart 2: BJToto's daily chart as at Sep 21, 2017 (Source: Malaysiastock.biz)

Conclusion

Based on better financial performance and attractive valuation, BJToto is definitely a stock worth considering for long-term investment at this beaten down price.

Note:
 
I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

NTPM: Earnings rose

Result Update

For QE31/7/2017, NTPM's net profit increased by 35% q-o-q or 29% y-o-y to RM12 million while revenue increased by 11% q-o-q or 16% y-o-y to RM176 million. Revenue increased y-o-y mainly due to the increase in sales of Tissue and Personal Care Products, especially Tissue segment. The increased revenue led to higher profits.

 
Table: NTPM's last 8 quarterly results


Graph: NTPM's last 48 quarterly results

Valuation

NTPM (closed at RM0.785 last Thursday) is now trading  at a PE of 16.7 times (based on last 4 quarters' EPS of 4.7 sen). NTPM pays a decent dividend, with dividend yield at 3%. At this PER, NTPM is deemed fairly valued.

Technical Outlook

NTPM is in a medium-term uptrend line, with support at RM0.75. It is also in a long-term uptrend line since 2006.


Chart 1: NTPM's weekly chart as at Sep 21, 2017 (Source: Malaysiastock.biz)


Chart 2: NTPM's chart as at Sep 21, 2017 (Source: Malaysiastock.biz)

Conclusion

Based on satisfactory financial performance & positive technical outlook, NTPM is a good long-term investment.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Wednesday, September 20, 2017

CIMB: Broke the Intermediate Uptrend Line

CIMB surprised the market this morning with a sharp drop to RM6.22. A quick look at the press revealed that one of its big shareholders, Mitsubishi UFJ Financial Group Inc has sold off 412.5 million shares in CIMB in a range of RM6.15-6.30 yesterday. Institutional investors are like any other investor out there; If the price is right, they will sell.

Beyond the big block changing hand, we can see that CIMB has now broken below its 9-month old uptrend line at RM6.70 (see Chart 1). Recently, CIMB tested its 7-year old downtrend line at RM7.00-7.10 (see Chart 2). Both developments tang the bell for a period of price consolidation for CIMB. I think the stock is likely to trade sideways between RM6.00 and RM6.50 for the next few weeks until the next price direction has been determined by the market. I rate CIMB as a HOLD unless you can sell it above RM6.50 and switch to a cheaper banking stock.


Chart 1: CIMB weekly chart as at Sep 20, 2017_10.00 (Source: Malaysiastock.biz)


Chart 2: CIMB monthly chart as at Sep 20, 2017_10.00 (Source: Shareinvestor.com)

Note:
I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Tech Stocks Looking Toppish

Technology stocks had a good run since the start of the year. We played catch-up after the scorching run in Nasdaq and other stock markets worldwide. Now we can see that the rally may be due for a pullback or consolidation.

Consolidation is not a bad word. After a strong rally, consolidation will allow the market to digest the recent gain and new players to come into the market. Our objective will be to take some profit for our "over-priced" stocks or to avoid buying "over-priced" stocks just before consolidation set in. Of course it is always easier said than done. The old adage that the market will always find a way to prove us wrong, should not deter us from taking action when action is warranted. Instead we should acquaint ourselves with a lesser-known wisdom that it is better to be generally correct than to be precisely wrong. Good luck!


Chart: FBMACE & TECHNOLOGY Indices weekly chart as at Sep 19, 2017 (Source: Shareinvestor.com)

Monday, September 18, 2017

LAFMSIA: Next Upleg Has Begun?

Background

Lafarge Malaysia Bhd (“LAFMSIA”) is involved in the manufacture, sales & distribution of cement and clinker. LAFMSIA is also involved in the production & sales of ready-mixed concrete and trading in building material.

LAFMSIA has the largest installed cement capacity of 14.14 million metric tonnes (MT) and the most comprehensive network of facilities in Malaysia. The group owns integrated cement plants, two grinding stations, over 40 ready-mix concrete batching plants and six aggregate quarries.

Historical Financial Performance

LAFMSIA's revenue & profits have been in a steady uptrend until FY2014. Since then both revenue and profits have been sliding, with sharper decline in profits.


 Graph 1: LAFMSIAs last 19 years revenue & profits

These are two things that I had noted:

1) LAFMSIA's profits slumped during periods of economic downturn like in FY1997 and FY2008, though the profits slump would actually come 2 years later in FY1999 and FY2010.
2) After that, LAFMSIA's profits would recover strongly but that recovery would fizzle out in  5-6 years time and the profits would drop again, like in FY2004-2004 and FY2014-2015.

If the profit slump in FY2005 can be a guide, LAFMSIA should manage to avoid going into the red now despite incurring net losses totaling RM93 million incurred in 1H2017. For that to happen, LAFMSIA must report net profit totaling more than RM93 million in 2H2017. Is that possible? We will have to wait and see. FYI, LAFMSIA's net profit in a good quarter in FY2014 touched RM70 million. SO it is not impossible that it might avoid a loss-making year in FY2017.

Recent Financial Results

In QE30/6/2017, LAFMSIA's net profit dropped 10% q-o-q to RM44 million on the back of a 5%-decline in revenue to RM532 million. The decline in revenue exceeds 19% y-o-y which caused the group to fall into the red, like in QE31/3/2017.

Revenue dropped q-o-q mainly due to lower sales contribution from the domestic Cement and Concrete segments from a weaker market demand attributed to the competitive environment. Despite the lower revenue, the Group’s loss before tax for the current quarter of RM57.9 million has improved slightly compared to RM63.4 million in preceding quarter, mainly due to the lower depreciation charges and improved operating cost as compared with preceding quarter partially offset by lower gain on disposal of property, plant and equipment.

Like the other players in the cement industry, LAFMSIA is hit by the excess capacity and the slowdown in demand due to weakness in property development. The situation may change when the major infrastructure projects, such as LRT3 or MRT2 or ECRL, are expected to take off in 2018.


Table 1: LAFMSIA’s last 8 quarters’ P&L


Graph 2: LAFMSIA’s last 42 quarters revenue & profits

Latest Financial Position

As at 30/6/2017, LAFMSIA's financial position is deemed fair with current ratio at 1.13x and total liabilities to total equity at 0.44x.

Valuation

We are unable to rely on the PER as a valuation model as LAFMSIA has a net loss of RM55 million in the past 4 quarters. Instead we have to rely on the Price to Book valuation model. What I did was to compare LAFMSIA prices during the 3 troughs with its Net Assets & Net Tangible Assets per share. You can see that LAFMSIA was trading fairly close to similar Price/Net Assets or Price/Net Tangible Assets in the previous trough in 2005.


Table 2: LAFMSIA's Price to Book Valuation in last 3 troughs

However LAFMSIA has run up 30% from its recent low without any improvement in earning yet. In that sense, LAFMSIA could be running ahead of its earning and that can be a recipe for a big drawback in price if disappointment ensued.

Technical Outlook

We can see from the weekly chart that LAFMSIA has broken above its immediate downtrend line, S2-S2 at RM6.00 as well as the "horizontal lie" AB at RM5.90. This double breakout has signaled the end of the downtrend and possibly the beginning of the next upleg.


Chart 1: LAFMSIA’s weekly chart as at Sep 15, 2017 (Source: Shareinvestor.com)

Below, you can see LAFMSIA was still in a long-term uptrend line with support at RM5.00.


Chart 2: LAFMSIA’s monthly chart as at Sep 15, 2017 (Source: Shareinvestor.com)

Conclusion

Based on technical breakout, LAFMSIA could be on the path of price recovery. If that panned out, the stock could be a BUY on weakness (at prices closer to RM6.00). However, any price recovery cannot sustain without earning recovery. Thus we should not take too large a position in this stock until we have seen an earning recovery in the quarters ahead. Good luck!

Note:
I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

MAGNI: Earnings Plunged

Results Update

Last Thursday (Sep 14), Magni announced its result for QE31/7/2017. Its net profit dropped 49% q-o-q or 17% y-o-y to RM20 million while revenue dropped 2% q-o-q but rose 8% y-o-y to RM294 million.

Revenue dropped y-o-y due to lower Garment revenue which decreased by 0.8% due to unfavorable foreign exchange differences and lower Packaging revenue which dropped 12.7% due to the closure of offset printing packaging business. These were partially offset the higher revenue from the continuing packaging operations which increased by 1.8%.

PBT dropped y-o-y due to lower Garment PBT which decreased by 43.2% mainly due to lower gross profit margin, higher operating expenses and softer revenue; lower Packaging PBT which dipped by 47.9% mainly due to higher raw material costs for corrugated packaging business. In addition, the comparative PBT for the immediate preceding quarter i.e. QE30/4/2017 was inflated by insurance claims (RM0.216 million) and reversal of over provision of business closure costs (RM0.356 million) in QE30/4/2017 by the discontinued packaging operation.

As a result of the sharp drop in profits, Magni cut its dividend to 3.5 sen from 6 or 7 sen in the immediate past 2 quarters. While the dividend cut may conserve its reserve for contingency or for new investment.


Table: Magni's last 8 quarterly results


Graph: Magni's last 42 quarterly results

Valuation

Magni (closed at RM6.16 on Friday) has a trailing PE of 8.6 times (based on last 4 quarters' EPS of 71.39 sen). Albeit the dividend cut, Magni still pays quarterly dividend which totaled 21.5 sen in the past 4 quarters; giving the stock a DY of 3.5%. Overall, Magni is still quite attractively valued.

Technical Outlook

Magni is still in a long-term uptrend, supported by its 10-month EMA line at RM6.00. Below this, Magni may have support from the 20-month EMA line at RM5.00 and then the horizontal line at RM4.50.


Chart 1: Magni's monthly chart as at Sep 15, 2017 (Source: ShareInvestor.com)


Chart 2: Magni's weekly chart as at Sep 15, 2017 (Source: ShareInvestor.com)

Conclusion

Despite the sharp drop in earning and dividend cut, Magni is still a good stock for long-term investment based on attractive valuation. After the sufficient price drop, the stock will be more appealing. The good entry level may be between RM5.00 and RM6.00.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.

Friday, September 08, 2017

Market Outlook as at September 8, 2017

I like to share two interesting developments that may affect our market next week. 

The first thing is USD-MYR  has broken its uptrend line (see Chart 1 below). The movement in that currency pair simply means MYR is gaining on USD. This is due more to weakness in the USD than strength in our MYR. Because if our MYR is really strengthening, we should see SGD-MYR breaking its uptrend line. From Chart 2 below, you can see that SGD-MYR is still in an uptrend- for now.



Chart 1: USD-MYR monthly chart as at Sep 8, 2017_12.30pm (Source: Investing.com)


Chart 2: SGD-MYR monthly chart as at Sep 8, 2017_12.30pm (Source: Investing.com)

As I said before, MYR need only to stabilize for our stock market to regain its uptrend. While we await the strengthening of MYR, we need not be overly pessimistic about the MYR or the economy. I maintain my earlier forecast that our market is likely to go higher in 2018.

The second thought I like to share is the improvement in some sectors in the market. The second liner stocks, as represented by FBM70, are improving. Those who are sitting on their cash, should slowly nibble into beaten down stocks that may not get any cheaper going forward.


Chart 3: FBM70's daily chart as at Sep 8, 2017_12.30pm (Source: Shareinvestor.com)

I think you can consider getting some Plantation stocks or some stocks in the Trading Service sector. I don't have a laundry list of good stocks to look at, except Tenaga. Technology stocks are richly priced. I would take some profit in that sector.


Chart 4: Plantation's daily chart as at Sep 8, 2017_12.30pm (Source: Shareinvestor.com)


Chart 5: Trad/Serv's daily chart as at Sep 8, 2017_12.30pm (Source: Shareinvestor.com)

Good luck and have a nice weekend.