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Hot Sector – Can banking stocks reverse the market downtrend?

Trading room – Tue 4 Dec 2018

 

According to one analyst’s report, the latest Oct 2018 Bank Negara Statistics showed that Industry loan growth in the banking sector gained traction to 6.0% YoY (year-on-year) in Oct 2018 (Sept 2018: 5.7% YoY) supported by a stronger momentum in non-household loans while growth in household loans remained stable.

The year-to-date (YTD) annualized industry loan growth was 5.4%, and it remained close to its expectation of 5.0% for 2018.

The Oct 2018 household loan growth was seen as steady at 5.9% YoY albeit a slight moderation after the tax holidays according to the analyst report.

The slightly slower pace was said to be contributed by a slowdown in the growth of mortgage loans, loans for purchase of securities and outstanding credit card receivables.

Meanwhile, loans for purchase cars were seen still holding up.

Continue reading Hot Sector – Can banking stocks reverse the market downtrend?

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Trading – Invest and empower in yourself to get your trading edge over others in the market

Trading room – Mon 3 Dec 2018

 

It’s possible for traders to tap into one of three general attitudes when they approach the market. The first attitude is one of pessimism and ignorance, the second is one of randomness and/or neutrality, and the third is one of empowerment.

The first attitude never works, the second attitude seldom brings much success, but the third attitude, when properly done, guarantees success and brings the trading edge over others you will never ever thought possible.

It is common knowledge in the market that only 5%-10% of traders (we call them elite traders) make money in the market while the balance 90% of traders (we call them common traders) lose their money trading the market every time, year-in and year-out.

Continue reading Trading – Invest and empower in yourself to get your trading edge over others in the market

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Market – Truce in global trade war, how should you trade?

Trading room – Mon 3 Dec 2018

 

It was reported that US president Donald Trump and China president Xi Jinping had agreed to a 90-day trade truce to allow for additional negotiations to address US concerns after China agreed to buy a “very substantial” amount of American exports, the White House said in a statement released late on Saturday.

It said that Chinese officials agreed that the country would buy more US products in an effort to reduce the large bilateral trade imbalance.

Meanwhile, Trump agreed to postpone for 90 days a scheduled increase in tariffs on US$200 billion in Chinese imports while talks to address American concerns about China’s trade practices take place.

Continue reading Market – Truce in global trade war, how should you trade?

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Warrants over GENM traded up a storm

Warrants Commentary (26 Nov to 30 Nov)

Last week, the trading value of structured warrants increased by 10.4% to RM410.8mil. for the week as a result of active trading in warrants over Genting Malaysia (GENM).  The share price of GENM took a beating last Tuesday as its planned Century Fox World theme park hit a brick wall, potentially creating a Continue reading Warrants over GENM traded up a storm

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Hot Sector – Should you seek refuge in rubber glove stocks?

Trading room – Fri 30 Nov 2018

 

Many analysts are pointing to the high valuations of rubber glove stocks as a deterrent to investing in glove makers.

Yet, it was reported that those who balked at buying glove stocks at the end of last year, because they believed valuations were too stretched, could be kicking themselves given that the share prices of the four largest glove manufacturers have outperformed the market by a long shot.

And rubber glove companies have continued to outperform, be it in earnings or share price performance. The interest in rubber glove stocks could also be due to their resilient business, which is a safe harbor in the face of many problems encountered in other sectors on Bursa Malaysia.

 

Performance of rubber glove stocks

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Hot Stocks – Where to trade Genting, Genting Malaysia and OWG?

Trading room – Wed 28 Nov 2018

 

It was reported by Star Online that Walt Disney Co and Twenty-First Century Fox Inc were sued for more than US$1 billion yesterday by casino operator Genting Malaysia Bhd, which accused them of abandoning a contract related to its planned construction of the first Fox-branded theme park.

According to the media report, Genting Malaysia said “seller’s remorse” induced Fox, with Disney’s help, to breach its 2013 contract with Fox Entertainment Group to license intellectual property for Fox World, a proposed addition to its Resorts World Genting complex, an hour’s drive from Kuala Lumpur.

The lawsuit was filed in the U.S. District Court in Los Angeles as Disney prepares to complete its $71.3 billion purchase of many Fox assets, expected in the first quarter of 2019.

It was later reported today that Disney and Fox rejected the claims as “without merit.”

Genting Malaysia said it had already made a “$750 million-plus investment” in Fox World. It is also seeking punitive damages.

 

The news sent both Genting Malaysia and its parent Genting, share prices sharply down yesterday. Genting Malaysia fell 16.7% to RM3.00, close to its low for the day of RM2.93, while Genting fell 7.5% to close at RM6.38.

Theme park operator cum leisure entertainment player OWG (Only World Group Holdings Berhad) also saw its share price falling 21.8% to RM0.485.

In reaction to the news, a research house has cut its fair value for Genting Malaysia RM3.65 from RM4.40 but has upgraded the stock to a buy.

 

As it is, the Genting group companies were hit by sell-downs on high volume previously in the aftermath of the Budget 2019 announced on Nov 2, 2018, which was a negative surprise for the gaming sector, as both casinos and number forecast operators (NFOs) were not spared.

According to an analyst report then, casino license fee will be raised to RM150m from RM120m p.a. while casino duty rate will be raised to 35% from 25% of gross gaming revenue and the number of special draws will be halved (for NFOs).

We had written in the mPower Algorithm report then that “Genting Malaysia volume of 379m then was at an all-time high for one year and if not for the fact that it was a first-day sell-off could have indicated a climatic bottom for the stock. With RM3.72 being the critical level for the stock, it appears that the sell-down may not be over.  The stock will try to reclaim the level above in the next few hours/days and if failed, a re-test of the strong support at RM3.18 is the target.”

 

With this target reached (Genting Malaysia share price now at around RM3.00), is the selldown finally over? Where is the actual level to trade buy Genting Malaysia on weakness for elite traders?

 

For Genting, we had also written in the mPower Algorithm report then that “Genting traded lower on a high volume of 36m shares which was its high 3 months volume but not too overly excessive. The RM6.80 critical level should be used to assess the weakness of the stock for short opportunities. If the stock rise above RM6.96 on daily volume of more than RM10m, stay aside for short opportunities at a higher level. A long-term target for the stock (if stay below RM7.00) could be RM6.41/or lower.

Genting actually broke the RM6.41 level yesterday and is now attempting a rebound? Is this the opportunity to trade in or its a bull trap for traders?

 

Meanwhile, for OWG, the selldown on the stock is already predicted from its downtrend which is in force sometime back. The selldown yesterday occurred at two key important considerations and you need to know these criteria before you decide to include the stock into your trading plan.

The trading action plan is very simple for OWG for elite traders and this is outlined in our mPower report. Act as soon as the key critical level mentioned in the report is breached in the direction of the breach.

 

Join and network with us at our mPower Algorithm and mPower Trading programs and see how your outlook on the market and stock portfolio could be helped and shaped by big data analytics and trading algorithms.