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TRANSCRIPT
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Copyright Alan Pei 2007.
Contents1. In depth of understanding of common indicators used in detail ( not normally learn from books):
a. ADX- Average Directional Movementb. MACD - Moving Average Convergence and Divergence c. Stochasticd. RSI – Relative Strength Indexe. Moving averages- 20,50,200 EMA how to use it the right wayf. Parabolic SAR
2. Candlestick – Doji, Moningstar, Evening Star , Harami Principle of symmetry in Time Fibonnaci expansion and retracement.
3. Identify Sectorial Rotation, Group Rotation.
Identify Leadership in stock (which are the leaders for super profit)Stock Market Cycle. Seasonal Tendency.
4. Detecting Resistance, Overhead supply area.
5. Detecting Recovery Phase in stocks.
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6. Detecting Accumulation phase in stocks
7. Detecting mark up/bullish and buy on weakness in mark up phase in stocks
8. Detecting warning phase in stocks
9. Detecting distribution phase (operators or funds trying dump stocks)
10. Detecting Bearish phase/mark down phase in stocks
11. A look at limit down stocks, how to prevent yourself holding stocks that may limit down
13.Trading Strategies how to buy IPO stocks and other trading techniques.Growth InvestingVulture Investing –how to buy stocks when they are in crisis.
14.Guppy MMA
15.Stockmarket as Barometer of economy.
16.Contrarian Opinion (reverse psychology method) and Psychology of Investment
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1.Dow Theory:
Uptrend means higher high and higher low in prices. Downtrend means lower high lower low in prices.
2.1 ADX is a powerful to gauge trend:
On daily and weekly chart or any time frame like 15 min or 60 min chart:
1. ADX <15 --trendless, sideway to drifting down.2. 16<ADX<25 –ranging market prices move in a range.3. 26<ADX<40-strong trending market.4. 41<ADX<55-very strong trending market.5. ADX>55 – very overbought market.
ADX is also a tool to know the beginning of a cycle. This can be seen when ADX hook up from below 20 level to between DI + and DI-. This signals a new up trend is emerging.If ADX hook up from below 20 level to between DI- and DI +, this signal a new downtrend is emerging.
If ADX is below both DI + and DI- don’t expect a meaningful trend.
A meaningful trend will emerge only when ADX is between DI+ and DI- or DI- and DI+ .
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Exceptional case is where ADX is below 20 best is below 15 then turns up and move fast to above 25 and go between DI+ and DI-. This signals the stock is in breakout mode either to the upside or downside. Upside if DI+ > DI- and Downside if DI- > DI+.
ADX can indicate whether a SUPERBULL RUN will occur for KLCI in a weekly chart when it goes below 15 and to a level similar to a level in the past where it indicated the emergence of SUPERBULL RUN.
If ADX goes above 55 and starts to hook down and pressures DI+ to converge with DI-, it signals retracement or sideway market. This is especially true if ADX starts to fall below 42 from values above 42.
The longer the ADX stays above 55, the longer it will take to digest the uptrend or downtrend in the form of retracement or corrections and the sideway moves that accompanies it.
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2.a TIME daily ADX <15
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2.b. INIX daily ADX<15
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2.c TAFI daily ADX <15
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2.d Dolomite daily ADX <15
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2.e A&M daily <15
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2.f GDEX daily <15
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2.g LIMAHSN daily <15
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KLCI ADX< 15 in weekly chart indicates emergence of SUPERBULL RUN
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2.h Commerz daily ADX >26
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2 Bursa ADX>26
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2 Genting ADX> 26
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2.h IPOWER daily ADX>26
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2.f AZRB daily ADX>26
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2.NSTP daily ADX >55
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KLCI daily ADX> 55 in Dec 2006
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MAS ADX >55 daily
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2.g Leong Hup (LHH) daily
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KLSE Composite (KLCI) ADX>55 60 min chart
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ANTAH ADX>55 in 60 min chart
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GENTING ADX > 55 in 60 min chart
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2.h Emivest daily
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RHBCAP weekly ADX> 26 and ADX is in between DI+ and DI- and DI+ > DI which is bullish
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MAS weekly ADX> 26 and ADX is in between DI+ and DI- and DI+ > DI which is bullish
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UEMWORLD ADX Weekly – ADX is in between DI+ and DI- and DI+ > DI which is bullish
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2.i IRIS ADX Weekly – ADX is in between DI+ and DI- and DI+ > DI which is bullish
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2.j UEMWORLD ADX Weekly – ADX is in between DI+ and DI- and DI+ > DI which is bullish
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2.j OILCORP Daily – ADX is above DI +. But DI+ doesn’t catch up with ADX instead diverge with ADX so uptrend with no power.
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Concept of Divergences.
Bearish/Negative Divergences:Higher High in prices but lower high in indicators like MACD, Stochastic, CCI.
Bullish/Positive Divergences:Lower low in prices but higher low in indicators like MACD, Stochastic, CCI
2.2MACD is a trending tool and also a momentum tool.
It can warn of end of trendIt can tell a rally is running out of steam
It can signal:Divergence –bullish bearish on daily chartDivergence –bullish or bearish on weekly chart very powerful can use to gauge accumulation.
MACD >0 – gaining momentum bullishMACD<0 – no trend , bearish
MACD gradient between 40 degree to 60 degree is bullish.
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SUNWAY WEEKLY MACD bullish divergence
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MAS WEEKLY MACD bullish divergence
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KINSTEEL weekly MACD bullish divergence
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ASIAEP daily MACD bullish divergence
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2.l Fajar daily
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2.m KLInfra daily
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2.n Digi weekly
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2.p Cocoland weekly
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2.o Nextnat daily
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2.3 Stochastic is a momentum tool.
It can :
Warn the end of trend or reversal.
It can signal:
Divergence –bullish bearish on daily chart
In Bull Market stochastic tends to stay above 80.In Bear Market stochastic tends to stay below 20.Use stochastic weekly to read KLCI movement if stochastic crosses above its signal line it’s bullish and below it’s bearish. It’s tool to see the end of correction not a tool to sell because it will be too late to sell. (combine with Guppy MMA as very effective tool).
Myth: Stochastic >80 is overbought. Stochastic < 20 is oversold.
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2.p Farmbes daily
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2.q Leong Hup daily
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2.5 CCI (13)
They can :Warn the end of trend or reversal.
They can signal:Divergence –bullish bearish on daily chart
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2.w Nextnat daily – bullish divergence in CCI
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2.x Nextnat daily
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2.6 Parabolic SARIn a daily chartIt signals upward push if it is below prices and ADX> 26 AND DI+ > DI-It signals downward pressure if it is above prices ADX>26 so the stock will go down or sideway.
Parabolic success rate is around 80%.
When ADX <26 which means a sideway or down market, parabolic doesn’t work so well.
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2.y Uemworld daily parabolic below price
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2.z Uembuilder parabolic below price
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2aa parabolic below price
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2.ab Nextnat daily
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Daily Moving AverageHow to use moving average:
What is uptrend : 20 ema> 50 ema> 200 ema
What is downtrend:200 ema> 50 ema> 20 ema
In an uptrend(bullish) 20 ema < 50 ema but both 20 ema and 50 still above 200 ema the stock will face correction in an uptrend.
In downtrend (bearish) , even 20 ema > 50 ema but both still below 200 ema this is just a rebound in a downtrend. Therefore, your don’t want to buy even this kind of rebound because the rebound may not be enough for you to make any money out of it.
Another way to use moving average is to play bounce or rebound in a 1st pullback only after a run up, provided 20 ema> 50 ema and both above 200 ema and also ADX > 25 and DI+>DI-.
Buy bounce at 20 ema , 50 ema, 200 ema the best is the stocks are in the middle of upmove but are whacked down by general market correction. What’s upmove counter? They are counters in top 10 volume or top 10 gainer.
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Moving average 50 day EMA daily support for AMMB
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Moving average 50 day EMA daily support for Digi
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Moving average 50 day EMA daily support for Hohup
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Moving average 50 day EMA daily support for GPRO
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Moving average 200 day EMA daily support for TWSPLANT
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Moving average 200 day EMA daily support for MRCB
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3.a Sectorial Rotation
Study Bursa other sector indexes like :
2n Board indexFinance indexConstruction indexMesdaq indexPlantation index
The indexes will provide clues to which sector is the leading the market or not. 3.b Group rotation
When a leading stock is undergoing a massive move, it will cause other stocks in the same group to move as well. The leader will move first and make big gains.
Then later when the leader reaches a price plateau and takes a rest to digest the run up, the leadership will temporarily pass to stocks in the same group to let them catch up.
The stock taking over the leadership temporary will exhibit massive price move behavior. Later when the stock reaches a price plateau, the leadership will pass back to the original leader and the circle will repeat a few times until the bull is over.
3.c Leadership stocks:
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Leaderships stocks have these characteristics:]
- Move first to achieve its 52 week high.-- During minor correction or market is selling off they either maintain or stay positive or they stay in tight range
horizontally. Someone is absorbing the stock while the market is selling off because they know when they sell-off is done the stock is going to take off.
-- They are the first to move when correction ends.-- They have a tendency to appear in Top 20 volume list or Top 20 gainer list again and again.-- They move the fastest and have highest price increase among they peers.
Stocks closer to their 52-week high have a greater chance of breaking out to new highs than those farther from their old highs.This is where you'll find stocks experiencing the biggest changes in trading volume compared to their average volume of the past 50 days. One stock might normally trade 100,000 shares a day and suddenly trade 500,000 shares. What's happening? It's a strong indication that mutual funds and other major investors are getting into it. And when a fund goes on a buying spree, typically it may buy the stock for weeks. That burst of buying is likely to push the stock's price higher
Most investors don't realize a "down" market is when they need to be watching for the next leaders, the stocks that will lead the market into its next bull phases and make the greatest gains. Only a handful of stocks will double or triple each year. Research shows that most of the leaders begin their runs in the first days and weeks after a confirmed new uptrend occurs:
Smart investors use down markets to create a watch list of likely leaders for the next rally. When the market turns and top stocks blow out of bases, they're ready to strike. The key is finding those diamonds in the rough.
Stocks tend to be at or near new highs when they start major advances. So this is a great place to look for possible buys and learn where the new leadership is emerging. The real leaders tend to emerge from the top five or six sectors.
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Go to Top 20 volume and Top 20 gainer pick up on the theme of strong volume. The lists highlights stocks with unusual activity that foretell a possible trend change.
And use the daily and weekly charts to examine stocks' price and volume action. Are they forming healthy bases or are they wide and loose or breaking down?
For smart investors, the bull market begins even before stocks recover. It begins by watching for industry groups and stocks setting up to play a leadership role in the next market uptrend.
3.d Stock market cycle and seasonal tendencyMalaysian stock market tends to make majority of gains between Dec-April period in tandem with the global market like Dow Jones, FTSE, Nikkei.
Typically after April the market goes into correction mode until November.
But there will be exception.
In a period of 10 years, you probably find that the stock market actually make big gains between April to July period. This is an exception rather than norm. And if does happen it’s extremely bullish. The last time market actually started to become bullish in April was 1999 and 2003 for KLCI.Bull started1999 April 1st ( pre election year for US . Malaysian Dec 1999)2003 May ( Iraq war and SARS delayed by 1 month and also 2004 US election year and also M’sia)2007 April ( pre election in US 2008 election year, M’sia ?The stockmarket has a tendency to go up during festive period. Like Chinese New Year. After hari raya. period.The stockmarket has a tendency to go up a few days prior to long weekend holiday or long holiday if the market is bullish.Malaysia Holiday falls between Nov – March.
Typically Friday is a bullish day. Monday and Thursday are the worst day of the week.
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4. Fibonacci –Used to gauge retracement. (Potential Reversal Zone)
Retracement numbers: 23.8, 38.2, 50, 61.8, 79, 89, 100.
Expansion numbers: 127,141,161.8,189,200,224,261.8,300,314,361.8,400,423.6,500,600,700,800,900,1000,1100.
5. Detecting Resistance , Overhead supply (stale bull). Remember it takes 18 months to wear out stale bulls!!!
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MAS daily overhead supply/stable/resistance
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Octagon daily overhead supply/stable/resistance
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Affin-wc daily overhead supply/stable/resistance
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5.a Cepat
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5.b Mkland
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5.c Nextnat daily
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5d. KLCI daily
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SANBUMI daily gap as resistance/overhead supply/stale bull
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Iris daily gap as resistance/overhead supply/stale bull
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The 6 phases of stock / stockmarket
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Recovery Phase- Flat base /Flat bottom
Accumulation Phase- Double bottom – a W shape pattern.
The W shape can have right and left side the same low. The W shape can have right side higher than left side low.
The W shape can have right side lower than left side low.
Bullish/Markup Phase- Cup and handle- Ascending Triangle- Pennant- Flag
Warning Phase- Bearish Wedge
Distribution Phase-Head and Shoulders-M top
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Recover Patterns – Flat baseAncom daily Flat Base
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Ancom weekly
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ASIAEP daily Flat Base
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ASIAEP weekly
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Maxtral daily Flat Base
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Maxtral weekly
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6.a KLInfra daily Flat Base
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Klinfra weekly
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6.b MMode daily Flat Base
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Mmode weekly
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6.c Cocoland daily Flat Base
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Cocoland weekly
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6.d Mobif daily Flat Base
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Mobif weekly
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6.e Ipower daily Flat Base
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Ipower weekly
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6.f Lipo daily Flat Base
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Lipo weekly
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6.g Techven daily Flat Base
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Techven weekly
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6.2. Double bottom (W bottom)Utama double bottom daily
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Utama double bottom weekly
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AMMB double bottom daily
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AMMB double bottom weekly
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Affin double bottom daily
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Affin double bottom weekly
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Mtronic double bottom daily
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Mtronic double bottom weekly
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Gamuda daily double bottom
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Gamuda weekly double bottom
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6.h Uemworld double bottom daily
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Uemworld weekly double bottom
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6.i Uembuilders daily double bottom
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Uembuilder weekly
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6.h AZRB daily double bottom
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Azrb weekly double bottom
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6.i Iris dailyly double bottom
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Iris weekly double bottom
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6.j LKT daily double bottom
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Lkt weekly double bottom
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KLCI daily double bottom June-July 2006
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KLCI weekly double bottom June-July 2006
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6.k KLCI daily double bottom December 2005
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6.l KLCI weekly double bottom December 2005
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6.m KLCI daily double bottom April-June 2005
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6.n KLCI weekly double bottom April-June 2005
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6p Patimas daily double bottom
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Patimas weekly double bottom
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7.Bullish/ mark up phase patterns.7a. Cup and Handle
Criteria of cup and handle :1.The bottom part of the cup should be rounded and give the appearance of “ U” and not very narrow “V” shape. “V’ shaped bottom cup tends to fail.
2.The formation of the cup can take few weeks to few months. The formation of the handle also can take 1 week to few weeks.
3.The retracement of the handle should not be more than 62% from the high of the right cup to the low of the base of the cup.The shallower the retracement the better. Best if less than 50%.
4.The formation of the handle highs should not drip upward to form a bearish rising wedge.
5.The formation of the handle highs should be flat or drift lower to wear out panicky stock buyers.
6.The height from the high of the handle to the base of the cup added to the breakout point at the handle is the target of this pattern.
7b Ascending Triangle
1. This pattern takes the shape of an ascending triangle.2. The price target of the pattern is the height of this pattern added to the breakout point.
7b Flag
1. This pattern resembles a flag2. The price target is the height of the pole of the flag added to the breakout point of the flag.
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7b. PennantThis pattern resembles a falling wedge
7 a MRCB 30 min cup and handle (C&H)
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7.b.K1 30 min cup and handle (C&H)
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7.c AIM 30 min C&H
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7d. KLCI daily cup and handle (C&H)
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7e. Iris daily C&H
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Iris C&H weekly
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7.f LKT C&H daily
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LKT C&H weekly
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7g Uemworld C&H daily
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Uemworld C&H weekly
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7h. Ipower C&H daily
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Ipower C&H weekly
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7.i Asiatic C&H daily
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Asiatic C&H weekly
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7.h Time daily C&H
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Time weekly C&H
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7.i MTDinfr daily C&H
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MTDinfr weekly C&H
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7.j IJM-WB daily C&H
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IJM_WB weekly C&H
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IJM ascending triangle daily
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IJM ascending triangle weekly
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7.k MRCB Ascending triangle daily
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7.l Affin Ascending triangle daily
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7.m Lionind Ascending Triangle Weekly
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7.n Mplant-wa Ascending Triangle daily
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7.p Isyoda – Ascending Triangle failure
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7.q Suninc – Ascending Triangle failure
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7.r Idaman Flag
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7.s Kheesan Flag
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7.t Iris flag
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7.u Uembuilder flag
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7.v LIMAHSN daily Flag
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7.w IJM-WB daily flag
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7.x TIME 30 min Pennant
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7.y Uemworld daily pennant
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7.z Hohup daily pennant
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7.aa Uembuilder daily pennant
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7ab Texcycl dail low volume breakout of C&H
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8.2 Selecting stocks using retracement method
Fib Retracement in % Chances of breaking the previous high in %
23.6 76.4
38.2 61.8
50 50
61.8 38.2
8.f Canone daily C&H
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8.g IJM-wb daily C&H
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Warning Phase
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IFCAMSC bearish Wedge in daily chart
Warning Phase
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MMODE bearish Wedge in daily chart
Warning Phase
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Catotec bearish Wedge in daily chart
Warning Phase
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Ekran bearish Wedge in daily chart
Warning Phase
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SERSOL bearish Wedge in daily chart
Warning phase
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EMIVEST bearish Wedge in daily chart
Distribution Phase
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L&G 2005 complex Head and Shoulders (H&S) in daily chart
Distribution Phase
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L&G 2003 complex Head and Shouders (H&S) in daily chart
Distribution Phase
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L&G 1999 complex Head and Shouders (H&S) in daily chart
Distribution Phase
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L&G 1994 complex Head and Shouders (H&S) in daily chart
Distribution Phase
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L&G 1990 complex Head and Shoulders (H&S) in daily chart
Distribution Phase
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SP Setia 2005 complex Head and Shoulders (H&S) in daily chart
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Distribution PhaseCocoland Slanted M Top in daily chart
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Distribution PhaseSetron Slanted M Top in daily chart
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Distribution PhasePSCI Slanted M Top in daily chart
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Distribution PhaseMqtech Slanted M Top in daily chart
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Distribution PhaseMolacs Double Top in daily chart
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Distribution PhaseUtama Double Top in daily chart
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Distribution PhaseUBB Double Top in daily chart
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Distribution PhaseAsiatic Double Top in daily chart
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Mark Down PhaseKL Infrastructure closed down on higher volume daily
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Mark Down PhaseSYF closed down on higher volume daily chart
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Mark Down PhaseJPK closed down on higher volume daily chart
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Aventur many types of triangles in mark down phase
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Mieco many types of triangles in mark down stage
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Symphony many Descending Triangle
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Mark down phaseKLCI 2000 plunge
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Mark down phase KLCI 2002 plunge
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Detecting distribution days in KLCI (When to clear your portfolio)
Five distributions days in a period of 3- 4 weeks are enough to kill the market.
Criteria :
1 A distribution day is a day that is down or closes unchanged or little changed compare to the previous day.
2 The volume of the day is bigger than the previous day.
3. There are more losers than gainers.
If there are not more than 5 distribution days after the first distribution day within a period of one month starting from the 1st distribution day , reset your count to zero.
Strategy:
3 distribution days go 100% cash .5 distribution days market will go big correction.
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KLCI Jan –Feb 2005 distribution days prior to plunge
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KLCI March-April 2004 distribution days prior to plunge
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KLCI April 2002 distribution days prior to plunge
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KLCI Jan-Feb 2000 distribution days prior to plunge
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A look at limit down stocks and how to prevent holding stocks that may limit downCepat
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A look at limit down stocks and how to prevent holding stocks that may limit downEmivest
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A look at limit down stocks and how to prevent holding stocks that may limit downFtec
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A look at limit down stocks and how to prevent holding stocks that may limit downGplus
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A look at limit down stocks and how to prevent holding stocks that may limit downKaipeng
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A look at limit down stocks and how to prevent holding stocks that may limit downKimble
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A look at limit down stocks and how to prevent holding stocks that may limit downLiihen
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A look at limit down stocks and how to prevent holding stocks that may limit downTanahmas
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A look at limit down stocks and how to prevent holding stocks that may limit downSinmah
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A look at limit down stocks and how to prevent holding stocks that may limit downPworth
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A look at limit down stocks and how to prevent holding stocks that may limit downLipo
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A look at limit down stocks and how to prevent holding stocks that may limit downLiqua
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12. Guppy MMA
Short term moving averages are: 3,5,8,10,15 ema
Long term moving averages are: 30,35,40,45,50 ema
Guppy MMA patterns:
Bearish—long term moving averages above short term moving averages
Bull trap—long term moving averages still above short term moving averages or long term moving averages still confused state
Bullish—short term moving averages above long term moving averages
Bear Trap-- short term moving averages still above long term moving averages and long term moving average shows separation between the long term moving averages.
Long term group compression- bulls and bears are fighting
Short term group compression – short term profit taking
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Bearish Guppy – KLCI May – June 2006
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Bearish Guppy – MISC
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Bearish Guppy – Genting
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Bearish Guppy – Nasdaq May – June 2006
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Bearish Guppy –Dow Jones May – June 2006
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Bearish Guppy –KLCI Feb 2005
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Bearish Guppy –KLCI Feb 2005-continued
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12. Bearish Guppy –KLCI April 2004
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10.Bearish Guppy –KLCI April 2004-continued
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12.Bearish Guppy –May April 2002
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12.Bearish Guppy –May April 2002-continued
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12.Bearish Guppy –KLCI April 2000
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12.Bearish Guppy –KLCI April 2000-continued
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12.Bearish Guppy March 1997
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12.Bearish Guppy March 1997-continued
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12.Bearish Guppy, Bull trap-August-Sept 2002
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12. Bearish Guppy, Bull trap-October 2000-February 2001
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12.Bullish Guppy, August 2004-Jan 2005
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12.Bullish Guppy, May 2003-April-2004
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12.Bullish Guppy, November 2001-May 2002
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12.Bullish Guppy-Bear trap, December 2004
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Trading Strategies
IPO playCup and handleHoly grail to 20 day emaRetracement to 50 day emaRetracement to 200 day ema
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IPO play – ELTITECH daily
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IPO play – N2N daily
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IPO play – Nextnation daily
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IPO play – ELSOFT daily
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IPO play – REXIT daily
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IPO play – JADI daily
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IPO play – AIM daily (failure)
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IPO play –MNC daily (failure)
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IPO play –Carotec daily
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Cup and handle – RHB
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Holy Grail--ADX>30, Stock pullback below 20 day EMA. Buy break above 20 day EMA.
FAP
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Holy Grail--ADX>30, Stock pullback below 20 day EMA. Buy break above 20 day EMA.
Gplus
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50 day ema play – Uemworld
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50 day ema play – Uembuilder
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50 day ema play – Faber
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200 day ema play – TIME
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200 day ema play – MRCB
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200 day ema play – TIMECOM
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50RSI - 50EMA Strategy for buying in a retracement in uptrend for rebound
1.The stock must be in uptrend of bull run.2.ADX>25.3.Price during correction penetrated the 50 ema.4.At the same time RSI (20) plunge below 50 line but did not go below 40. If RSI is below 40 it's a very weak stock.
5. Buy when price bounce up above 50 ema and RSI above 50 again. It’s a buy.
Stockmarket as Barometer of economy.
Stock market generally moves 6-9 months ahead of the economic growth or slowdown.
Malaysia Economy
Economy—overview: After a decade of 8% average GDP growth, the Malaysian economy—severely hit by the regional financial crisis—declined 7% in 1998. Malaysia will likely remain in recession for the first half of 1999; official statistics continue to show anemic exports, and some private financial analysts forecast a further drop in GDP of 1% in 1999. Prime Minister MAHATHIR has imposed capital controls to protect the local currency while cutting interest rates to stimulate the economy. Kuala Lumpur also announced an expansionary budget for 1999 to combat rising unemployment. Malaysia continues to seek funding from domestic and international sources to help finance its budget deficit and recapitalize its weakened banking sector.
StockmarketUnemployment is a lagging indicator of economy.
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Contrarian Opinion (reverse psychology method) and Psychology of Investment
Don’t belive in Fundmentals believe in charts. There is nothing called fundamentals.Buy when there’s blood in the streetOct 2002- Businessweek – Bears Are GrowlingBusinessweek – 2002 March –Malaysia could be the coming one –stockamarket
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PETER BRIMELOW
Surprise: Bears still growling about 1987 Commentary: They see similarities in 2006 to the '87 crashBy Peter Brimelow, MarketWatchLast Update: 12:01 AM ET Aug 21, 2006
NEW YORK (MarketWatch) -- Market up five days running. Biggest Nasdaq gain in four years. Time for something distinctly depressing!Well, not deeply depressing ... totally. But checking around, I was surprised to find that Don Hays of Hays Advisory, the respected institutionally-oriented superbull, was having one of his periodic moments of nuanced doubt after the past week's strong action. He wrote in his last bulletin: "We are amazed at the lack of belief in this rally by the public investor. We find the 'dumb' investor is still nervous and cautious, and the 'smart' investor is not yet bailing out. So yes, you have to start paring back on those disappointing stocks that have not used the recent up-move in the market to heal themselves ..." But, Hays qualified with his usual exquisiteness, "Don't overdo it. The tug-of-war ... is still on the side of the bulls." And, more alarmingly, John Mauldin of Millennium Wave Advisors was reflecting in his week-ending e-letter about taking the hard-landing side in against Oak Associates' Ed Yardeni in a point-counterpoint debate interview that appeared in Aug. 18 Wall Street Journal Online. See Wall Street Journal column. Mauldin's bearish take: "We have a slowing economy and rising inflation - by any other name that's stagflation. And given all the excesses of the 1990s and the excesses of the housing market, a little stagflation - maybe including a mild recession - may be about the best outcome we could ask for." Mauldin's more-alarming afterthought: a chart argument made by Bill King in his daily King Report that the S&P 500 action after June has produced what King calls a "W pattern" with three forays up to 1,280-1,300 separated by two down to 1,220. Ominously, King notes, that's just what happened before the 1987 Crash. King wrote: "We are NOT suggesting that a 1987-like crash is imminent; but we are warning that 'W' formations can lead to dramatic market reversals. The current stock market is in a weaker technical position that it was in 1987 as evinced by its position to its quarterly and yearly moving averages. In 1987 interest rates were much higher, but the economy was stronger and the US trade deficit problem was in its embryonic stage." King's conclusion: "The moral of the story is stocks need to rally sharply from here to negate the 'W' pattern, or on any decline stocks must NOT breach the base of the 'W' pattern." (i.e. 1,220). If a stock decline violates the base of the 'W' pattern, Big Mo, as in 'Momentum Players' will be unleashed by traders and investors and he will be hurling red tickets." I can't help it; I always twitch when anyone talks about the 1987 Crash. You had to be there. And, as it happens, from a very different perspective, New York University economist Nouriel Roubini last week also published a discussion on his Roubini Global Economic service on "The Scary Similarities between 2006 and 1987." Among other factors, Roubini cites "trade protectionism and asset protectionism; hedgy and trigger-happy investors and rising geopolitical risks; the risk of a disorderly fall in the U.S. dollar; a slush of financial derivatives that are a black box that no-one understands... frothy markets where years of too easy
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money have created bubbles galore - the latest in housing - that are ready to burst; a bubble of thousands of new hedge funds with inexperienced managers...a housing market whose rout may trigger systemic effects ..." Many readers don't like me quoting bears. But, hey, you aren't going to hear about them from your broker.
2000 Businessweek- Jeff Bezos – and Time 1999 man of the Year – Jeff Bezos – Amazon CEO front pageTyco- Kalowski Forbes , Fortune we will beat GE , he boasted quaterly profit of 60 %-70% increase for 4-5 quarter.
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Timeline of the Tyco International scandal Key dates and events that led to the convictions of former Tyco CEO L. Dennis Kozlowski and CFO Mark Swartz:
March 13, 2001: Tyco announces $9.2 billion cash and stock deal to purchase the CIT Group, a commercial finance company. Tyco director Frank Walsh helps arrange the deal.
Dec. 5, 2001: Tyco shares close at a high of $59.76 on the New York Stock Exchange.
Jan. 14, 2002: Business Week magazine lists Tyco CEO L. Dennis Kozlowski as one of the top 25 corporate managers of 2001.
Jan. 22, 2002: Kozlowski announces plans to split Tyco into four independent, publicly traded companies. The announcement starts a slide in the price of Tyco shares.
Jan. 29, 2002: Tyco shares drop sharply, one day after the company filed a proxy report with the Securities and Exchange Commission disclosing that Walsh got a $10 million fee on the CIT Group deal, and that another $10 million went to a charity where he was a director.
Jan. 30, 2002:The New York Times reports that Kozlowski and Tyco CFO Mark Swartz sold more than $100 million of their Tyco stock the previous fiscal year despite public statements that they rarely sold their stock. Kozlowski and Swartz say they will buy 1 million shares with their own money.
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June 3, 2002: Kozlowski resigns unexpectedly as The New York Times reports he is the subject of a sales tax evasion investigation by Manhattan District Attorney Robert Morgenthau's office.
June 4, 2002: Morgenthau announces a criminal indictment accusing Kozlowski of conspiring to evade more than $1 million in state and city sales tax on fine art purchases.
Sept. 12, 2002: Morgenthau announces a criminal indictment accusing Kozlowski and Swartz of enterprise corruption for allegedly stealing more than $170 million from Tyco and obtaining $430 million by fraud in the sale of company shares. Former Tyco corporate counsel Mark Belnick is charged separately with falsifying records to conceal more than $14 million in company loans.
Dec. 17, 2002: Former Tyco board member Frank Walsh pleads guilty in an alleged scheme to hide the $20 million in fees for the CIT Group deal.
Oct. 7, 2003: The first trial of Kozlowski and Swartz begins with opening statements in which prosecutors characterize them as crime bosses who looted Tyco. Defense lawyers call them honest executives who deserved and disclosed all corporate payments and perks.
Oct. 28, 2003: The jury is shown a video of a birthday party Kozlowski threw for his wife at a resort in Sardinia. Tyco paid roughly half the $2 million cost of the event, which featured entertainers clad in togas and an appearance by singer Jimmy Buffett.
Nov. 25, 2003: Prosecutors show the jury a video of the $6,000 shower curtain and other lavish furnishings that decorated Kozlowski's Tyco-owned apartment in Manhattan.
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April 2, 2004: A mistrial is declared after a juror says she received a letter pressuring her to convict Kozlowski and Swartz. Some observers said the juror, Ruth Jordan, had previously appeared to make an "O.K." sign to defense lawyers. She subsequently denied making any gesture toward the defense team.
July 15, 2004: In a separate trial, former Tyco corporate counsel Mark Belnick is acquitted of charges that he received millions in loans from the company and failed to disclose the payments.
Jan. 26, 2005: The second trial of Kozlowski and Swartz begins with opening statements in which prosecutors switch tactics to focus on money the two allegedly stole from Tyco. They do not mention Kozlowski's $6,000 shower curtain or the Sardinia birthday party for his wife.
April 27, 2005: Kozlowski, who did not testify at his first trial, takes the stand and testifies that the millions of dollars in Tyco payments and perks he received had been properly authorized and disclosed.
June 17, 2005: A Manhattan jury finds Kozlowski and Swartz guilty of stealing more than $150 million from Tyco. They each could face 25 years in prison.
CA – Computer Associates – restate accounting Sanjay Kumar ceo- court case. Inflated sales and boasted to analyst.
KBES—2002-2003 it was around 90c
Nextnation- no worries nextnation 1.00 I will push it up
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CC/MR/PR1706 News Release Malaysia Airlines reports end of year losses. Business Turnaround Plan announced Kuala Lumpur, 27 February 2006: Malaysia Airlines today reported a final quarter loss of RM616.4 million for October 2005 - December 2005 and a net loss of RM 1.3 billion for the financial period April 2005 - December 2005. Revenue for the financial period was up by 10.3% or RM826.9 million, compared to same period for 2004, driven by 10.2% growth in passenger traffic. International passenger revenue increased by RM457.6 million or 8.4% to RM5.9 billion while cargo revenue decreased by RM64.1million or 4.2% to RM1.5 billion.
Costs increased by 28.8% or RM2.3 billion, amounting to a total of RM 10.3 billion, primarily due to escalating fuel prices. Other significant cost increases included staff costs, handling & landing fees, aircraft maintenance & overhaul charges, Widespread Assets Unbundling (WAU) charges & leases. Fuel Costs The most substantial factor for the losses was from fuel costs. For the period, the total fuel cost was RM3.5 billion representing a 40.4% increase compared to the same period in 2004. Total fuel cost increase comprised RM977.8 million due to higher fuel price and another RM157.6 million due to additional consumption. In the third quarter, fuel costs amounted to RM1.26 billion compared to the RM1.01 billion in the corresponding period in 2004; resulting in 24.6% increase or RM249.3 million. Other Operating Expenses Staff costs for the financial year was RM1.2 billion, an increase of 20.6% compared to RM1 billion in 2004. Final quarter staff costs increased by 12.3%, compared to the same period last year. The increase for the financial year under review was attributable to the implementation of upward staff salary and allowance revisions. The third largest cost item was aircraft maintenance & overhaul amounting to RM635 million which translates to a 23.1% increase compared to the year earlier. Third quarter maintenance & overhaul totalled to RM202.9 million, up 9.2% compared to the corresponding quarter. This increase, for the year, was due to some credits received from suppliers for year 2004, which lowered 2004 costs, and required redelivery maintenance checks in 2005. For 2005, WAU and lease charges were RM372.2 million, reflecting a 78.4% increase against similar charges in 2004. The final quarter increase for these charges was 113.7% higher than the same quarter of 2004, totaling RM154.9 million due to revised lease rental rates and higher London Inter Bank Offer Rate (LIBOR) in 2005 compared to 2004.
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2 Handling and landing fees rose 19.9% or RM202.4 million from 2004 to RM1.2 billion. Total handling & landing fees for the final quarter amounted to RM444.9 million, an increase of 25.8% or RM91.2 million. This increase was due to increase in number of stations and flights as well as under provisions from the financial year 2004. In announcing details of the financial results, YM Tengku Azmil Zahruddin, Executive Director/Chief Financial Officer said, “When Mr Idris Jala came on board as Managing Director in December 2005, we were already examining various issues and factors that were leading us to the current financial situation. In the past three months, we have carefully conceptualized the initiatives required to turnaround the business. We are now ready to share the details of our plans and intensify the actions necessary to move forward positively.” The MAS Way - Business Turnaround Plan In announcing the Business Turnaround plan, Managing Director, Idris Jala, said: We are dedicated to the creation of a company that will be a source of pride and admiration for its employees and indeed all its stakeholders. The MAS of tomorrow will maintain its five-star product, have a competitive cost structure in the region, be renowned as being one of the best places to work in Malaysia, have closed much of the revenue performance gap to our peers and will return to profitability in 2007. We can do this, and we will.” “A real business turnaround is an imperative for MAS. The management team, and our staff believes strongly in our ability to transform the business and, indeed, to go beyond expectations. MAS has done much to improve its performance over the last 5 years, and indeed last year. We have much to be proud of, and this work will form the foundation of our success,” he added. Since early December 2005, the management team has dedicated itself to the development of a plan that builds off the actions taken by the Board in 2005 to begin the turnaround. This turnaround plan will not only reverse the loss and return MAS to profitability, but also transform the company into a strong and vibrant institution—one that is capable of withstanding external shocks and aggressively tackling new opportunities. The Business Turnaround Plan has been developed using the GLC Transformation Manual as a guide. It takes into account the recommendations in the manual and adapts these for implementation in MAS in the context of the business turnaround. The plan will enable MAS to realize a net income of RM500 million in 2008 – an all-time high profit for MAS – and to be well positioned to improve its net income even further. It should be pointed out that when MAS announces its improvement turnaround amounting to RM1.1 billion in 2006, this does not necessarily mean that MAS will make a profit in 2006. The headline KPIs in the scorecard are targets or aspirations set by the company as a transparent performance management practice. These headline KPIs should not be construed as either forecasts, projections or estimates of the company or representations of any future performance, occurrence or matter as the headline KPIs are merely a set of targets/aspirations of future performance aligned to the company’s strategy. 3 Any financial figures referred to as ‘forecast’ and ‘estimates’ in the Business Turnaround Plan for all intent and purposes are KPIs (as defined in point 1 above). Therefore they should also be treated as targets or aspirations set by the company as a transparent management practice. The plan has five central thrusts, each symbolised by a tail of the venerable MAS symbol. The MAS Way provides the framework for our Business Turnaround Plan: 1. Flying to win customers—MAS will reconfigure its network and product portfolio to ensure that it has the tools and capabilities to be a top-tier player. 2. Mastering operational excellence—MAS will build a unique operating capability. This capability will be reflected not only improved operational reliability, but also in higher productivity.
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3. Financing and aligning the business on P&L—MAS will relentlessly increase profits with the support of a world-class finance function that ensures true financial accountability, transparency and performance orientation. 4. Unleashing talents and capabilities—MAS is committed to its people it has the passion and talent to achieve the goals. 5. Winning coalitions— MAS needs the resolute support of the Government, its employees, managers, customers, suppliers, agents and investors. It is only with the support of these stakeholders that MAS can have the mandate it needs to make the changes that will ensure long-term success. The Business Turnaround plan has been carefully sequenced over the next 3 years to deliver cash, profitability and growth—in that order of intensity and focus. At the same time, we will continue to foster an environment that allows the talents of its people to be unleashed and to flourish. In 2006, MAS is already undertaking a series of measures to raise RM4 billion in cash through internal and external sources to tide the airline through the current cash crisis. It is also tackling the biggest immediate profitability challenge: low yield. MAS has award-winning products and services, a competitive cost base, and a load factor that is only slightly below average. In 2007, the plan will focus on improving efficiency and capabilities. In 2008, the focus will be on new growth opportunities.
1 • Review of FY2005 in Appendices A/B attached. 2 • Full details of “The MAS Way: Business Turnaround Plan” are available on the
Malaysia Airlines website www.malaysiaairlines.com.
Issued by: Corporate Communications Malaysia Airlines, Kuala Lumpur
------------------------------------------------------------------------------------------------------------ For enquiries on this release: Media Relations: Anbarasu Tel: (603) 2165 5034 HP: 0192224952 Investor Relations: Nova Ceceliana Nelson Tel: (603) 2165 5453 HP:0122777659 4 Appendix A REVIEW OF FINANCIAL PERIOD ENDED 31 DECEMBER 2005 AGAINST 31
DECEMBER 2004.
Financials – A Closer Look 1 • Total revenue of RM8.9 billion, improved by 10.3% from RM8.0 billion for period ended 31
December 2004. 2 • Cargo revenue of RM1.5 billion, decreased by 4.2% or RM65.7 million compared to the
corresponding period in 2004. 3 • Fuel cost of RM 3.5 billion, increased by 40.4% or RM1.0 billion, driven primarily by high fuel
prices. 4 • Loss for the period RM1.3 billion, from a profit after tax of RM216.9 million, in 2004. 5 • As at 31 December 2005, cash balance reduced to RM1.2 billion from RM2.2 billion as at 31
March 2005. 6 • Shareholders funds decreased by 39.1% to RM2.0 billion 7 • Net assets per share decreased by 39.6% to RM 1.62 per share.
International Operations Passenger
1 • Passenger uplift increased by 10.2% or 0.66 million for the year to 7.1 million. 2 • International passenger revenue of RM5.91 billion, improved by 8.4% from RM5.45 billion.
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3 • Revenue passenger km (RPK) growth of 10.2% exceeded the available seat km (ASK) growth of 3.9%.
4 • There were improvements in seat factor, which increased by 4.1 percentage points or 6.1%. 5 • Yield (excluding fuel surcharge) decreased by 1.6% to 18.6 sen per RPK from 18.9 sen per RPK
the previous corresponding year. Yield (inclusive fuel surcharge) increased by 3.1% to 19.8 sen from 19.2 sen in the previous corresponding period.
Cargo 1 • Cargo tonnage carried decreased by 0.1% to 405.5 million kg from 405.2 million kg. 2 • Load Tonnage Kilometers (LTKM) decreased by 5.5% to 1.95 billion TKM from 2.06 billion
TKM 3 • Cargo load factor increased by 0.8 percentage points to 62.0%. 4 • Cargo yield (excluding fuel surcharge) increased to 74.8 sen per TKM from 73.8 sen per TKM
which is an increase of 1.35%. Yield (inclusive fuel surcharge) increased to 90.2 sen from 81.8 sen which is a 10.3% increase.
5 Appendix B DETAILS OF REVENUE & EXPENDITURE FOR FINANCIAL PERIOD ENDED 31
DECEMBER 2005 AGAINST 31 DECEMBER 2004. Malaysian Airline System Berhad FY05 Results for the Period April 2005 – December 2005
Period ended 31/12/05 Period ended 31/12/04 Variance % RM'Mil RM'Mil RM'Mil
Revenue 8,850.8 8,023.9 826.9 10.3
Expenditure (10,329.4) (8,024.4) (2,305.0)
28.7
Other income 231.1 227.1 4.0 1.8
Operating (loss)/profit (1,247.5) 226.6 (1,474.1)
(650.5)
Finance cost (5.8) (0.1) (5.7) 5,700
(1,253.3) 226.5 (1,479.8) (653.3) Share of result of associated companies 12.1 15.3 (3.2) (20.9)
(Loss)/profit before taxation (1,241.2) 241.8 (1,483.0)
(613.3)
Taxation (20) (23.0) 3.0 (13.0)
(Loss)/profit after taxation before Minority Interest (1,261.2) 218.8 (1,480.0
) (676.4) Minority interests (3.6) (1.9) (1.7) (89.5)
(Loss)/profit for the period (1,264.8) 216.9 (1,481.7
) (683.1)
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6 Malaysian Airline System Berhad FY05 Expenditure for the Period
April 2005 – December 2005.
Period ended 31/12/05 Period ended 31/12/04 Variance % Achieved Achieved RM'Mil RM'Mil RM'Mil
Fuel cost 3,535.1 2,517.8
1,017.3 40.4
Staff cost 1,216.5 1,008.5 208.0 20.6
Hire of aircraft & engines 1,085.1 1,024.8 60.3 5.9
Handling & landing fees 1,217.7 1,015.3 202.4 19.9
Commission & sales incentives 496.8 427.1 69.7 16.3
Aircraft maintenance & overhaul 635.0 515.8 119.2 23.1
Meal and other inflight expenses 389.8 342.7 47.1 13.7 Foreign exchange (gain)/loss (17.9) (20.0) 2.1 (10.5) Advertising & promotions 130.7 119.3 11.4 9.6 Depreciation 173.8 149.6 24.2 16.2 WAU charges & leases 372.2 208.6 163.6 78.4 Rentals 84.3 78.8 5.5 7.0 Others 1,010.3 636.1 374.2 58.8 -
Total Expenditure 10,329.4 8,024.4
2,305.0 28.7
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03-11-2006: OSK Research maintains buy call on MAS
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OSK Investment Research Sdn Bhd has maintained its buy recommendation on Malaysian Airline Systems Bhd (MAS) at RM3.45 with a target price of RM3.90 based on the revised price earnings ratio of 15 times, as the airline was expected to break even in third quarter FY06 (3Q06).
The research house said MAS was expected to record a profit in 3Q06, including exceptional gains of RM150 million from the early cancellation of its wide asset unbundling programme and mutual separation scheme, as well RM46 million from the sale of its headquarters.
However, it said that without the exceptional gains and recent developments, MAS’ 3Q06 core net profits might just break even or slip into a minor loss.
OSK Research said that fuel price was not the reason for the uncertainty as MAS had already hedged 75% of its fuel requirement at US$57 (RM207.98) per barrel.
“More surprising to us is the high domestic revenue passenger kilometre (RPK) numbers even post rationalisation. We had earlier expected MAS to record 35% drop in its RPK numbers after July.”
“Thus far the drop is only 25%, partly due to the government’s request for more frequencies in East Malaysia. As expected, domestic operations may still be loss making this year as the higher than expected RPK numbers also boost our cost estimates,” it said.
OSK Research said it was revising its assumptions given the higher than expected costs due to domestic traffic, resulting in the core loss estimate for MAS in FY06 to increased to RM392 million from RM280 million.
“We expect MAS to just break even in 3Q while 4Q numbers should be more positive,” it said.
The research house said MAS’ FY06 numbers should be much better than the RM620 million loss expected in the business turnaround plan.
“As for FY07, we expect cost saving initiatives to kick in and therefore the higher than expected domestic traffic numbers have less impact and as such, we are only reducing our FY07 numbers slightly by 13.4%,” it said.
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02-02-2007: HLG Research: RHB Cap target price RM3.94
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HLG Research is maintaining a trading buy on RHB Capital Bhd, which is in the midst of a merger and acquisition play, at RM3.62 while target price is RM3.94.
"Our target price of RM3.94 is based on an M&A simulated revised net asset value (RNAV) estimate yielding an implied 1.8 times FY07 earnings P/NTA (price/net tangible asset)," it said.
It said the 1.8 times was reasonable given the historical track record for M&A (merger and acquisition) transaction multiples.
The research house said on Feb 2 the ideal criteria for the M&A should address Rashid Hussain Bhd (RHB) group’s shareholders’ deadlock, debt woes, collapsing group structure as well as allowing a strategic partner to emerge at RHB Capital.
RHB’s single largest shareholder Utama Banking Group Bhd (UBG) said on Jan 31 it had received Bank Negara's go-ahead to start negotiations with the consortium led by Primus Pacific Partners Ltd over the proposed recapitalisation and restructuring of its RHB.
On Jan 16, Kuwait Finance House (M) Bhd inked a memorandum of understanding with UBG to acquire the latter’s 32.8% stake in RHB, its warrants and loan stocks as well as the call warrants in RHB Capital.
“We believe that this step is just the tip of the iceberg as the subsequent stage could see EPF (Employees Provident Fund) or the strategic partner entering the RHB Group gaining from further operational upside from RHB Bank,” HLG Research said.
The house also believed the M&A plan as an “indirect way” for EPF and the strategic partner to extract RHB Group’s precious gem — RHB Bank.
“Additionally, while the above plans were silent on the resolution of the interco loans between RHB and RHB Capital and the INCPS at RHB Bank, we believe these issues would be addressed in time,” the house added.
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HLG maintains hold on Kurnia, price downside limited 10-11-2005 Email us your feedback at [email protected]
HLG Research has maintained a hold on Kurnia Asia Bhd despite it reporting a 38% quarter-quarter fall in net profit in the insurance company's first quarter on a 9.8% decline in revenue and a 10.8% dip in gross premium.
"We are maintaining our hold recommendation with a revised fair value of RM1.13 based on 11x PE multiple on FY06 EPS of 10.3 sen.
"We think that downside to stock price is limited, supported by its strong dividend yields of between 5.1%-6.1% going forward," it said in a research note on Nov 10.
HLG Research said Kurnia's annualised 1QFY06 net profit of RM37.2m was 16.0% and 12.9% below market and its forecasts respectively.
HLG Research said it had tweaked its claims ratio for FY06-08 upwards from 59.5%-59.6% to 61.5% to reflect the deterioration in the first quarter to 61.2% from 52.4% in 4QFY05.
"In addition, gross premium has been revised downwards by 3%-6% for FY06-08. Revised net profit for the period are RM154.1m, RM169.3m and RM184.5m respectively."
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03-04-2006: Heitech, Mesiniaga to be among biggest beneficiaries By Ashwin Raman Email us your feedback at [email protected]
Heitech Padu Bhd and Mesiniaga Bhd are expected to be the biggest beneficiaries among IT service providers under the Ninth Malaysia Plan (9MP), OSK Investment Research said.
Out of the total RM12.88 billion allocated for the information and communications technology sector, the government has budgeted RM5.7 billion for the computerisation of the public sector.
In a report on April 3, the research house upgraded Heitech and Mesiniaga to buy at RM1.13 and RM2.55, respectively, as it expected the two companies to be awarded contracts under the 9MP.
OSK Research has target prices of RM1.57 and RM3.20 for Heitech and Mesiniaga, representing an upside of 39% and 25.5%, respectively.
It added both companies had the potential to secure the government contracts as Heitech was well-connected with the public sector while Mesiniaga was established under the New Economic Policy.
“Pegging a conservative FY07 price earnings ratio (PER) of 8.5 times, which is still a 28% compared to the average five-year historical low PER of 11.8 times, Heitech is worth RM1.57,” it said.
It said Mesiniaga was worth RM3.20 per share pegged at a FY07 PER of 8.5 times, which was a 31% discount compared to its five-year historical low PER of 12.4 times.
OSK Research said the government’s allocation for the computerisation of government agencies was 55% higher than its allocation to bridge the digital divide in the country.
It said a big portion of the allocation under 9MP would be channelled to the Road Transport Department, Department of Immigration and National Registrations Department on the enhancement and upgrading of its existing IT systems.
It said the Ministry of Education, Ministry of Health, Ministry of Defense, Ministry of Agriculture and Ministry of Tourism may also undergo computerisation programmes, with Heitech and Mesinaga being the biggest beneficiaries.
It added another source for prime priming for IT spending in the public sector during the 9MP was e-learning with Heitech potentially securing contracts from e-learning programmes through its subsidiary, Educational Trend Sdn Bhd, which provides e-Learning solutions among other professional services.
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29-01-2007: CIMB ups MRCB target price to RM1.63
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CIMB Research has raised its target price for Malaysian Resources Corporation Bhd (MRCB) to RM1.63 from RM1.31 previously in anticipation of more corporate developments in the coming months.
“MRCB is in store for exciting times in tandem with the upsurge in government pump-priming,” the research house said in a report on Jan 22, which called for a buy on MRCB at RM1.22.
It said the raised target price was in line with the rise in the construction sector's CY08 (calendar year 2008) price earnings multiple to 20 times from 16 times previously.
"We believe MRCB deserves to trade on par with the big three contractors given the expected strong newsflow in the coming months," it said.
It said the three main potential developments were MRCB’s good chance in becoming the main beneficiary of the RM9 billion Bakun power transmission project, the RM1.2 billion Penang Monorail project and the RM1 billion Eastern Dispersal Link (EDL) concession in Johor.
"The RM1.2 billion Duta Ulu Kelang Expressway (Duke) was progressing well," it said, adding that concession earnings would provide a stream of recurring income.
It said earnings visibility was improving with more upside coming from its engineering and construction division in line with the expected resurgence in construction activities this year.
It said other developments, namely MRCB’s overseas ventures, particularly in the Middle East, and the acceleration of KL Sentral developments, were also expected to boost MRCB’s share performance.
CIMB Research also took note of MRCB’s de-gearing efforts, including the gain of RM80 million from the sale of Plaza Sentral 2, disposal of 25% stake in UDA Holdings Bhd for RM260 million and a RM44.9 million gain from the sale of its stake in Media Prima Bhd.
“Gearing is expected to go down to a more manageable level of 1.4 times to 1.5 times,” it added.
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The lazy way to buy/ select stocks in Malaysian stockmarket:Blue Chips:
MaybankCommerz(CIMB)TenagaMiscUMWDIGIMaxisTMBursa
Financials Affin
RHBRHBCAPUTAMAAMMBMplant
The GLCsMRCBKhazanah linked companiesUEMWORLDUEMBUILDERSTIME
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TIMECOMFABERKUB
Chinese corporate figures The public bank group
Public BankLPI
YTL groupYTLCORPYTLEYTLCEMENTYTLPOWERYTLLAND
LION LION GROUPLIONINDLIONDIVLONFIBACB
Genting groupGENTINGRESORTLANDMARK
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ASIATICSyed Mokhtar group
IJMIJMPLANTATIONROADBUILDERMMCORPZELAN(TRONOH)MSCDRBHCOMBERNASTWSCORPTWSPLANTATIONRBLAND
SPSETIAGAMUDAANANDA KRISHNAN
ASTROMAXISTANJONG
Get inspired by brands around and see their charts. The more they are visible in the media like TVADVERTISEMENT on their services and products offered u better check their charts. Not because they are famous for their earnings. When you buy growth companies u buy innovation.Innovation drives stock prices like DIGI, CIMB Bank, BONIA, CHEETAH, PADINI, PELIKAN etcRHB Bank. APPLE eg IPOD
Follow the smartmoney.
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Spotting stocks
General Market – average- KLCISubindex- Mesdaq, 2nd boardGroup/SectorStocks-leading stocks- minimum 2 stocks Leading are stocks in top 20 gainer or volumeThen zoom in on their stock price patterns- cup and handle , double bottomFor cup and handle – shallow retracement in the handle portion less 50% , THE BEST IS 23.6%Double bottom play right side lower then left sideLook at price patterns before looking at indicators like cci, stochastic, macd, adx, guppy, parabolic weeklyRemember to look at weekly chart all the time weekly can tell u the resistance levels
Trade Management and Portofolio Management.
Always set a stop loss for the stocks purchased. Typically the losses shouldn’t be more than 10% of your purchase price.
Not all purchased stocks will make money. If you keep your losses small and if your accuracy is around 70% you still can make money.
Always trim or sell your stocks that under perform your other stocks holdings. Keep winners trim losers.
Don’t over diversify because it’s hard to monitor stocks when you hold too many of them.
It’s best to purchase maximum of 5 counters and the very best 5 leading stocks in leading sectors than 10 lagging stocks.
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Stockmarket intraday rhythm.
Sideway to bullish market scenario
It’s not a good idea to buy stocks early in the morning between 9.00 am-10.00 am. Typically professionals sell their stocks within the period.
If the market surges between 9.00 am-11am , after 11.00 am the general market will soften and slow down. Therefore stocks will pull back during 11am-12pm period. And after 12pm stocks will rebound in tandem with the rebounding general market until closing at 12.30 pm.
Between 2.30pm-4pm generally the market will soften some more. Stocks tend to pull back some more during this period. If general market surges higher between 2.30pm -4pm going into new high, typically it will pull back after 4pm. So professionals tend to sell during this period if the general market rises strongly within this period (2.30pm-4pm).
If the market softens further between 2.30pm to 4pm, typically after 4pm market will start to rebound and firm back towards closing.
Typically the best time to buy stocks is between 4pm-5pm in this kind of market.
Bearish scenario
Typically the market will open in negative territory and slowly rebound back towards 11 am. But after 12pm market tends to soften again.
After 2.30-3.30pm market will worsen. Sometimes it will be getting even worse till 4.30pm when market starts to rebound towards closing but closes in negative territory at 5.03pm
Another scenario during bear market is : Market opens gap up because the prior day market was badly battered and drop a lot eg. 20-30 points and over night, Dow Jones went up a lot. Beware of this kind of bull trap. Typically between 9 am -11 am the general market and stocks will go up a lot but after 11 am market tends to soften. Then after 2.30pm market drop further till closing.
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How World Market Performance affects our market.
It’s very important to monitor by looking at the charts of the world stock market indexes for clues to our market.
Typical world indexes to monitor are:
Dow Jones IndustrialNasdaq CompositeS&PNikkei (Japan)DAX (Germany)FTSE (UK)
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How to sell stocks1. If there is no distributions days in KLCI (no more 3 to 5)
If your stock I up 5-10% everyday just don’t sellBut suddenly up >20 % per day non stop for 4-5 days get ready to sell because final climax run is near.
2. Patterns to sell like Bearish Wedge, Head and Shoulders, M top
3 When the market corrects u sell (KLCI has more 3 day distribution days or more)
4. How you protect your profit. Sell below the previous 2 days low if your stocks rockets and goes vertical in the chart
6. When your stocks price drop with volume eg the volume is higher then previous day dangerous sign.
7 U must retain 50% of your profit, if it drops below 50% of profit sell no matter what.
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