Warrants Commentary (14 May to 18 May)
Warrants trading activity surged when the market reopened on Monday following a 3-day break in conjunction with the 14th General Election (GE14) on Wednesday, followed by the two special public holidays on Thursday and Friday declared by the new government after the Pakatan Harapan coalition won an unexpected but peaceful GE14. The local benchmark index FBM KLCI fell as much as 2.7% in the first trading hour on Monday as fears over political uncertainties kicked in. However, the index rebounded strongly and settled 0.2% higher at 1850.4 points, while recording a jaw-dropping RM7.3bil turnover on Monday.
Last week, total warrants turnover rose 221.8% to RM526.8 mil compared to only RM163.7 mil traded in the previous short week. Hang Seng Index (HSI) warrants continued to dominate the warrants space, constituting 48.0% of the total market last week. Call warrant HSI-C3B was actively on investors’ radars, with RM103.3 mil changing hands. Investors were seen taking profit on the call warrant, net selling 8.1 mil units as the HSI futures gained 364.0 points on Monday.
On single stocks, Sapura Energy started the week on a strong note as its share price rose 26.1% when Brent crude oil prices broke new highs and settled at USD78.23/barrel on Monday. However, the share price lost its upward momentum and closed lower for the remaining days of the week. Although the share price tumbled 10.0% to close at RM0.76 on Friday, the share price was still up 13.4% week-on-week (w-o-w). The call warrant over Sapura Energy, SAPNRGC64, was the top traded warrant with more than RM38.0 mil traded last week, with investors taking home 15.1 mil units of the call warrant. The warrant bid price tracked the underlying’s movement and gained 44.4% w-o-w to close at RM0.065 on Friday.
In addition, Malaysian plantation giant Felda Global Venture (FGV) was another top performer on Monday, rising 11.8% to RM1.80. The share price continued to rally on Tuesday and Wednesday, gaining a total of 5.0% before closing 3.1% lower to RM1.83 on Friday. Among all call warrants over FGV listed on Bursa Malaysia, FGV-C42 was investors’ favourite, with more than 35.7 mil units traded.
Top 5 warrants by traded value:
|Warrant name||Value (RM’mil)||Issuer||Exercise level||Expiry date|
|HSI-C3B||103.3||Macquarie||HKD31,200||30 Jul 18|
|HSI-H4B||40.8||Macquarie||HKD28,800||30 Jul 18|
|SAPNRG-C64||38.0||Macquarie||RM0.50||31 Oct 18|
|HSI-H4C||29.5||Macquarie||HKD30,200||30 Jul 18|
|HSI-C1X||29.0||Macquarie||HKD32,000||28 Jun 18|
To view the full list of structured warrants available on Bursa Malaysia, kindly visit malaysiawarrants.com.my.
Provided for Malaysian residents information only. It is not an offer or recommendation to trade and is not research material. Past performance is not indicative of future performance. You should make your own assessment and seek professional advice.
article by Macquarie Warrants Malaysia