Tuesday, January 5, 2010

2010 Stock Tips From HWANGDBS

Investors should buy Malaysian banks such as CIMB Group Holdings Bhd, and property and energy stocks including Tenaga Nasional Bhd that will benefit most from the nation’s economic rebound, HWANGDBS Vickers Research Sdn. said.

“On the back of strong growth outlook and positive market drivers, the longer term upward trend is intact,” Wong Ming Tek, an analyst at HWANGDBS said in a report today. He expects the benchmark stock index to rise to 1,448 by year-end, he said.

The index climbed 45 per cent last year, as Prime Minister Datuk Seri Najib Razak announced stimulus plans valued at RM67 billion to pull the economy from its first recession in a decade. He has also eased rules governing overseas investors, initial public offerings and property purchases in a bid to lure more foreign money.

HWANGDBS’s report reflects similar views by other researchers. Today, Maybank Investment Bank Bhd raised its end-2010 index target to 1,410 from 1,370, based on improving corporate earnings and consumer confidence.

The reforms and initiatives introduced by Najib to help stimulate growth and boost income in the economy should continue this year, Wong said.

Malaysia’s economy may be set for a “sharp rebound,” with gross domestic product expanding 5 per cent this year after shrinking an estimated 2.4 per cent in 2009, Wong said.

“We like banks as proxies to the strengthening of the economic recovery,” he said. Tenaga will also benefit as every 1 per cent improvement in electricity demand would bolster earnings by 9 per cent, he said.

His picks include builder Gamuda Bhd, SP Setia Bhd, Malaysia’s biggest property developer, and rival Malaysian Resources Corp.

1 comment:

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