Trade Shares or Stocks in Bursa Malaysia|How to start Trading | Trade Stocks in Bursa Malaysia | How to Open Trading Account | How to Open CDS Account | What is Collateralised Trading | Discretionary Financing | Share Margin Financing | CDS Share Transfer | Securities Borrowing and Lending (SBL) | Regulated Short Selling (RSS) | Brokerage | Internet Trading Brokerage Discount | Cash Upfront Brokerage Discount | Clearing Fees | Contract Stamp Duties | Bursa Malaysia | Composite Index | Bursa News | Listed Companies News | Market News | Market Outlook

Malaysian Resources Corp Bhd (MRCB) has won a RM1.33 billion contract from Syarikat Prasarana Negara Bhd for the Ampang light rail transit (LRT) project.

This confirms a Business Times report on June 15 that MRCB was poised to win the job.

In a statement to Bursa Malaysia yesterday , MRCB said its subsidiary, MRCB Engineering Sdn Bhd (MESB), won the job for the construction and completion of facilities works, including fabrication and delivery of segmental box girders.

“The lump-sum contract worth about RM1.33 billion is for a construction period of 30 months from the date of possession of site,” MRCB said.

Additionally, MRCB also said that MESB won a sub-contract worth RM67.2 million from Sunway Construction Sdn Bhd.

The sub-contract is for the fabrication and delivery of segmental box girders for the Kelana Jaya LRT extension project.

Related Posts:

• MRCB to merge with IJM Land
• EPF fails to takeover MRCB
• EPF general offer for MRCB

AirAsia Bhd’s biggest shareholder may agree to exchange a 10 per cent stake in the low-cost carrier for stock of Malaysian Airline System Bhd as soon as tomorrow, according to a person involved in the discussions.

Malaysian Air’s government-controlled parent, Khazanah Nasional Bhd, will give Tune Air Sdn Bhd stock worth as much as the AirAsia stake, said the person who declined to be identified as the discussions are private. Sepang, Malaysia-based AirAsia, the region’s biggest low-carrier, has a market value of US$3.6 billion, about double Malaysian Air’s.

Cooperation between the two airlines, which both halted their shares from trading today, could pare competition as global economic concerns threaten to damp air travel. Malaysian Air could be able to focus on challenging Singapore Airlines Ltd. for premium travelers on long-haul routes, while ceding shorter services to AirAsia, according to AmResearch Sdn Bhd, which upgraded Malaysian Air to “buy” today.

“They should focus on cooperation instead of fighting each other,” said Ang Kok Heng, who oversees US$292 million as chief investment officer at Phillip Capital Management Sdn Bhd. An alliance could give the carriers improved bargaining power in negotiating new routes and plane orders, while Malaysian Air could also get help with fuel-hedging, he said.

Tony Fernandes, the chief executive officer of Sepang, Malaysia-based AirAsia and the biggest shareholder in Tune Air, declined to comment by text message. Khazanah spokesman Mohd Asuki Abas declined to comment when phoned by Bloomberg News.

AirAsia Growth

AirAsia has surpassed Malaysian Air in market value as Fernandes expands its low-cost operations across the region. In June, the carrier ordered 200 Airbus SAS A320neo airplanes. That raised its total orders for A320 aircraft to 375, including 89 that had already been delivered, the planemaker said at the time.

The airline and Malaysian Air both halted their shares pending announcements related to material transactions, according to separate Kuala Lumpur stock exchange statements today. CIMB Investment Bank Bhd. made announcements on behalf of both carriers.

AirAsia has surged 56 per cent this year in Kuala Lumpur trading, making it the only one of the 18 stocks in the Bloomberg Asia Pacific Airlines Index to have risen in the period. It dropped 3.7 per cent to RM3.95 on Aug. 5.

Malaysian Air, based in Subang near Kuala Lumpur, jumped 8.1 per cent last week, closing at RM1.60 on Aug. 5. Khazanah, Malaysia’s state investment company, owns 69 per cent of the carrier.

AirAsia flies to more than 20 countries, according to its website. It has ventures in Thailand and Indonesia, and it’s setting up operations in the Philippines, Vietnam and Japan. It offers long-haul flights through affiliate AirAsia X Sdn Bhd.

Malaysian Air flies to more than 100 destinations worldwide, according to its website. The airline in June announced an agreement to join the Oneworld alliance, led by British Airways and American Airlines.

Related Posts:

• Fernandes – No MAS – AirAsia merger
• AirAsia profit up
• World’s Best Low-Cost Airline – AirAsia
• AirAsia entering Japan market
• AirAsia might pay dividend in future

The stock market has lost more than RM60.6 billion in value over the past two trading days, but situation could worsen if more selling pressure is in the offing, as this may trigger a series of margin calls by brokerages.

“If the markets go down a bit more, broking houses will likely require its clients to top up cash, failing which investors who are trading on margins will have their shares foresold,” said a stock broker, adding for now none of the major firms have made the margin call.

Jupiter Securities head of research Pong Teng Siew said when the margin call is made, the market will dip again.

“We can certainly expect another round of dumping,” said Pong, adding analysts were also concerned of “sell orders” by foreign funds.

“We need to keep a close watch on how the foreign market perform over the next few days, for signs of any possible sell orders,” said Pong.

Over the past two trading days, the value of the local stock market has gone down from RM1.34 trillion to about RM1.28 trillion.

Yesterday alone, market value lost was RM33.76 billion.

Good news is that, analysts said that the selling over the past two days may be overdone and a short-term rebound may be underway.

The Relative Strength Index (RSI) of the benchmark KLCI yesterday was at 20.36. The RSI measures the momentum of a security to determine whether it is in an overbought or oversold condition.

A reading between 70-80 warns users of an overbought condition and is likely to encounter a downward correction. Reading between 30-20 are considered oversold condition, and warns users of an imminent upward correction.

Stocks that may rebound include DRB-HICOM Bhd (share price fell 3.17 per cent to RM2.14 yesterday), Coastal Contracts Bhd (down 8.25 per cent to RM2.11), UEM Land Bhd (down 8.86 per cent to RM2.16), Malaysian Building Society Bhd (down 2.4 per cent to RM1.61), Gamuda Bhd (down 4.76 per cent to RM3.20), Malaysia Resources Corp Bhd (down 3.95 per cent to RM2.19) and SP Setia Bhd (down 4.64 per cent to RM3.70).

According to analysts, these are some of the many stocks that they were optimistic over in the long run, backed by fundamentals.

DRB-HICOM has a target price of as high as RM3.95, Gamuda RM5.63, UEM Land RM3.90, Coastal Contracts has a target price of more than RM3.80, SP Setia more than RM5.40, and MRCB above RM3.00.

There were also 47 stocks that were trading at the 52-week low yesterday. They included Bursa Malaysia Bhd, Naim Holdings Bhd, Star Publications Bhd, UOA Development Bhd, Alam Maritim Resources Bhd, YTL Corp Bhd, YTL Power Bhd, KNM Group Bhd, Ma-xis Bhd, Kinsteel Bhd, Puncak Niaga Holdings Bhd, JCY International Bhd, Berjaya Land Bhd and KLCC Property Holdings Bhd.

Related Posts:

• No Related Posts