Good job on your website, i somehow stumbled into it as i was researching some info on atrium reit. I’m curious to know why analyst prefer Axis Reit compare to Atrium Reit although from your article Atrium Reit seems to be quite solid too. Any comment?

thanks

Vinod – don’t be fooled by the bear market rally. Take a closer look and you will see that it is a narrow rally lead by IOI Corp (and other palm oil stocks), which I believe is on a long term downtrend from its RM9 high few months back. I guess people still have a love affair with this stock and feel it’s cheap but in fact its earnings in the near future are unlikely to go anywhere near its heyday. If you look at it rationally, its free cash flow of less than RM1 billion cannot justify its RM30 billion market cap unless CPO goes to 5000 per ton. Other stocks that have powered ahead are selected bank stocks such as Bumiputra Commerce and AMMB, but these have been hard hit in the October 2008 sell down coz of their foreign shareholding. I believe the market now realize that these are solid companies and we are seeing strong buying support. In contrast Maybank hasn’t really moved and will be dogged by its Indonesian acquisition for a long time. Public Bank hasn’t really moved too coz it’s fully valued. Note also that market volume is not fantastic yet so to conclude we are in a long term uptrend is risky! To me it looks like a start of an earnings downgrade cycle which will deepen first. I just got news that Dubai’s Meydan LLC has axed the racehorse construction deal with WCT Engineering, this is only the start so make sure you avoid construction stocks with exposure to middle east. But having said all this the market is always ahead of the reality – at some point it will move ahead for real. I’m still researching on some forward indicators that will be a more reliable guide, will keep you posted for sure

How come the damn market ( KLCI) can move up when all u read about is gloom gloom and more gloom

Have heard that many factories are on 4 days now coz of lower orders

SO back to my Q?? How come the KLCI is up – don’t the investors here know about the “dreaded recession / stagflation” Or is it coz of a New Year euphoria??

Hope you can give some explanation – coz it just astounds me – fundamentals not changed, industries are tightening up their belts, analysts have so much to say about the BEAR market— but where did the bull appear in the KLCI??

Hey – Happy New Year and keep writing those articles bro

Vinod

The other is on AMMB and Hong Leong Bank just after their recent quarterly results here:
http://www.horizon.my/2008/11/banking-profits-ambank-versus-hong-leong-bank/

I do believe that the banking sector will be affected in the slowdown with slightly higher NPLs and slower loan growth. But overall it will still be robust. Good banks like AMMB and CIMB will continue to take retail market share from weaker players. Then PBBank and HLbank will have lower NPLs relative to the rest coz they are more careful usually.

Happy New Year

Thanks ever so much for the reply – yes I did discover the same and managed to get the graphs. I also accessed the horizon.my website and obtained the graphs from there.

Actually I wish you had posted thi 2 weeks back – as I was then completing my assignment – Has the 2007-2008 financial crisis impacted malaysian banking stocks – it would have been of great help to me. While there are so many articles, opinions etc most of it is still parroting what’s already been reported by others. This article of yours was different in the sense that CIMB research did do their own research and graphs.

Nvm – I will always be looking at your website for my future assignments

BTW I am pursuing my MSc(Banking)

Any articles on the latest proposed amendments to Basel II ?? Same will be appreciated

Thanks & happy New Year

vinod