RHBInvest Research Highlights 28th October 2010

Top Story

Property:

• Picking among the best – SPSB vs. IJMLD.
• Maintain Outperform call for both SPSB and IJMLD with a target price of RM5.94 and RM3.50

Sector Call

Building Materials:

• Cement sub-sector: Lafarge vs. YTL Cement.
• Lafarge: Fair Value is 7.42. Underperform.
• YTL Cement: Fair Value is 5.59. Outperform.
• Maintain Neutral stance on the cement sub-sector.

Corporate Highlights

KFC:

• Ayamas – Spreading its wings; Another RPT with JCorp.
• Target price is RM3.85, revise our recommendation to Trading Buy from outperforms.

Technical Highlights

Daily Trading Strategy:

• Pending clearance from the eventful week ahead.
• Profit-taking activities are expected to continue ahead of the next week’s US FOMC meeting and the two by-elections in Galas and Batu Sapi respectively.
• Nevertheless, the 10-day SMA near 1,491 should cap its near-term downside, while the 40-day SMA at 1,467 and critical support at 1,450
• For the index to resume its positive trend, it will need to recapture the 1,500 psychological hurdle and yesterday’s high of 1,504.37
• Meanwhile, we expect the market to trade rangebound pending more clearance from the eventful week ahead.

Daily Technical Watch: Cepatwawasan

• Heading lower to cover a technical gap near RM1.19-1.22 soon.
• Immediate Support at RM1.29
• Immediate Resistance at RM1.44