Gaming (Neutral)

What's There in 2012?

'''' Gaming sector is expected to feel positive spillover from consumerism following the announced Malaysia Budget 2012 and potential job and income creation from the implementation of ETP projects.

'''' BToto will be experiencing the full impact from its new game segment, 4D Jackpot with 7.6% growth in FY04/12. For GenM, international operations are the focus now with its latest development in New York and the current passing of the State Senate on the destination resort bill.

'''' GenS will continue to be the main contributor for GenT and with the full expansion in RWS by 2012, better growth is expected to be seen.

'''' No changes made to our forecast as we have earlier imputed all potential earnings in 2012. We are NEUTRAL with the sector. Maintain BUY on BToto (unchanged TP of RM4.92) and HOLD on both GenM (unchanged TP of RM4.07) and GenT (unchanged TP of RM11.19).

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Moderation in November Exports

'''' Export growth moderated to 8.0% yoy in Nov (Oct: +15.4% yoy), below the consensus estimate of 11.9% expansion. Import growth, however, picked up to 8.4% yoy (Oct: +4.0% yoy). Trade surplus narrowed to RM9.5bn in Nov (Oct: RM13.3bn).

'''' E&E export growth declined by 3.5% yoy (Oct: -9.0% yoy) which is in tandem with the development in E&E output.

'''' As expected, contribution of palm oil diminished drastically in November. Exports of palm oil slowed sharply to 4.2% yoy (Oct: +54.3% yoy), ending 14 consecutive months of double-digit growth.

'''' The rebound in import growth with intermediate imports rising by 4.6% yoy suggests that manufactured exports could remain stable in the coming months.

'''' We maintain our full year 2011 GDP estimate at 5.1%, factoring in 4Q estimate of 5.0% (unchanged). We also maintain 2012 GDP growth forecast at 4.5%.

'''' We expect BNM to hold the OPR at 3.00% until end-2012 given the resilient economic growth with sticky inflation.

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KLCI: Interests in lower liners to sustain momentum

'''' Technically, trend and momentum indicators remain supportive for further upside as KLCI continues to leverage on its strong supports near 10-d SMA (now at 1513) and 200-day SMA (1502), in an attempt to slowly filling the huge gap within 1529-1546 levels dated 5 Aug 11.''

'''' Immediate supports are 10-d SMA and 200-d SMA, followed by the uptrend line near 1490 pts.

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HSI: Short term positive after recent breakout

'''' In the short term, HSI is poised for greater heights following its recent positive breakout, supported by bullish trend and momentum indicators on its daily and weekly charts.

'''' Immediate supports are 18561 (mid Bollinger band), 18000 and 17951 (lower Bollinger band). Resistance levels are 20338 (weekly upper Bollinger band and downtrend channel), 21078 (50-w SMA) and 21416 (100-w SMA).