Follow Us For The Latest Updates

Follow Us For The Latest Updates

Newsbreaks spur the Malaysia warrants market

Warrants Commentary (25 to 29 November)

Last Sunday (24 Nov), Hong Kong held its district council elections as protests paused to allow the elections to proceed peacefully. The pro-democracy party won a landslide victory. The Hang Seng Index (HSI) surged 1.5% to 26,993.0 points on Monday, prompting investors to take profit on 17.5mil units of call warrant HSI-C7J and 13.7mil units of HSI-C7F as they rose 14.3% and 24.3%, respectively. Investors who expected a downturn bought the put warrants, namely HSI-H8E and HSI-H8F. The index then fell 0.3% on Tuesday and rose 0.1% on Wednesday.

Overnight on Wednesday, US President Donald Trump signed the Hong Kong Human Rights and Democracy Act into law. US stocks rose overnight, posting fresh intraday records. The HSI did not follow, falling 0.2% on Thursday and 2.0% on Friday to 26,346.5 points, ending the week 0.9% lower week-on-week. Investors took profit on 14.6mil units of HSI-H8F as this warrant gained 40.4% on Friday. This put warrant emerged as the top traded warrant for the third week in a row, with RM66.6mil traded. Investors also net bought 21.1mil units of HSI-C7K and 18.2mil units of HSI-C7J on Friday, resulting in HSI-C7J being sold out. Currently, three HSI call warrants, HSI-C7E, HSI-C7F and HSI-C7J are sold out. Do exercise caution when trading sold out warrants as the bid price for these warrants may be inflated by other investors queuing in the market. Refer to the live matrix to see the fair bid price of a warrant.

In Malaysia, various local companies released their quarterly financial results last week, acting as a catalyst for warrants over a variety of Malaysian shares, including Ekovest, Telekom, MY E.G. Services, DRB-HICOM and others. Further, warrants over the local benchmark FBM KLCI drew interest, with put warrant FBMKLCI-H8X seeing RM4.1mil traded over the week. Warrants over the FBM KLCI allow investors to gain leveraged exposure to the Malaysian market in general.

Meanwhile, warrants over Pentamaster Corporation drew investors’ interest on Friday as the share price opened lower in the morning from news that the semiconductor company has been excluded from the Syariah-compliant list. The shares hit a low of RM3.74 before rebounding to finish at RM4.48 on Friday, down 4.5%. Call warrants PENTA-CF and PENTA-CA were popular among investors.

Top warrants by value traded:

Warrant name Value
(RM’mil.)
Issuer Exercise price / level Expiry date
HSI-H8F 66.6 Macquarie 26,400 30 Dec 2019
HSI-C7K 51.5 Macquarie 28,000 27 Feb 2020
HSI-H8W 23.6 Macquarie 25,400 30 Mar 2020
HSI-C7Q 15.1 Macquarie 28,400 30 Mar 2020
PENTA-CF 16.9 Kenanga 3.88 16 Mar 2020

If you have any questions or need further assistance, please do not hesitate to contact us at info@malaysiawarrants.com.my.

To view the full list of structured warrants available on Bursa Malaysia, kindly visit malaysiawarrants.com.my.

Provided for Malaysian residents information only. It is not an offer or recommendation to trade and is not research material. Past performance is not indicative of future performance. You should make your own assessment and seek professional advice.

Share:

Share on facebook
Share on twitter
Share on linkedin
Share on telegram

More Posts

AME Elite Consortium Bhd – 2nd Dec 20

The proposed AME REIT would also provide stable and recurring income to investors, with at least 90.0% of its income to be distributed as dividends to unitholders. We note that slightly more than half of the current tenants of the industrial properties has more than 5 years of lease under their agreements. Additionally, AME REIT is expected to benefit from lower tax rate compared to prevailing corporate tax rate at an average of 23.4% recorded over the past 4 years.

technical focus

Technical Focus – 2nd Dec 20

Established historical track record since inception in 1975 with strong brand presence in the Malaysia household market. Demand will be relatively healthy, owing to the rising awareness of personal hygiene following the Covid-19 pandemic. Disposal of loss-making toilet rolls and tissue manufacturing subsidiary; NTMP Paper Mill (Bentong) Sdn Bhd allow the group to streamline and focus on the existing core businesses. Technically, price has experienced a flag-formation breakout above RM0.73, targeting the next resistances at RM0.795-0.815 with long term target at RM0.90.

market pulse

Swift recovery

Expectedly, the FBM KLCI performed a swift recovery as the key index recouped most of its previous session losses to re-claim the 1,600 psychological level. We reckon some stability will ensue with further upsides are in the cards as investors continue to focus on the economic recovery progress. Meanwhile, we believe that the lower liners will continue to enjoy their upward momentum as liquidity remains well on the equities market with investors capitalising on the positive market sentiment.

market pulse

Tempered by MSCI portfolio re-balancing

The FBM KLCI started off the week on a dour note alongside with the weakness across regional peers on the increasing geopolitical tension between US and China. Still, the FBM KLCI recorded 95.82 pts on gain (+6.5% MoM) during November 2020. Although we see renewed volatility unfolding, we reckon that bargain hunting activities may take precedence after the sharp fall yesterday. On the other hand, we think that the lower liners are poised for further upsides, driven by the improved trading liquidity which may extend the rotational play.

newsbreaks-spur-the-malaysia-warrants-market-m-online