Chartered CSM - positive news flow

Following CSM’s upward adjustment (narrowing its 2Q ‘09 estimated loss from US$59mln to US$49mln while raising its sales guidance from US$327mln to US$343mln) in 2Q ‘09 guidance last friday morning, its major customer Qualcomm also raised its 3Q ending June ’09 sales guidance to at least US$2.67bln versus last guidance of at most US$2.6bln (consensus were expecting US$2.55bln), while operating profit will be at least US$830mln versus last guidance of at most US$650mln. Qualcomm is benefitting from China’s launch of their 3G network services.

Other signs to support the recovery of the semiconductor sector can be seen in a recent 10-30% increase in prices of testing and packaging of chips, according to Digitimes.com. This should bode well for STATS whose core business is in the test and packaging of chips.

And currently running close to full utilization rates, UMC, the second largest foundry have raised its ownership in privately held China-based foundry Hejian Tech from 15% to 85% (Digitimes.com reported that UMC plans to double Hejian Tech’s production capacity soon after acquiring a controlling stake in the company).

CSM’s share price was around the $2.20 price level but fell close to the $2 level when CSM’s board dismissed the takeover rumours. But its share price have climbed to $2.36 as of last friday (up 3 cents) after it’s upward guidance for 2Q ‘09 performance. We do not have a rating on CSM.

Sponsored Links

Chart of Sino-Env, Cosco, Asia Env, Biosensor, Chartered

Sino-Env=$0.20, called buy on 9 Apr at $0.155... reached yellowline at $0.205...take profit?


CoscoCorp=$1.05 (It will be positive if it can cross and stay above the yellowline....reinstate a buy


Asia Env=$0.13 Breakout?


Biosensors if breakout 200DMA.....


Chartered=$0.135 could challenge the $0.16 resistance

Sell Venture, Midas; Buy CSM

Venture Corporation (VMS SP; S$5.49) – SELL

• Its uptrend since February appears to be over after last week’s shooting star pattern. Upside resistance at S$5.84 and S$6.27 is likely to cap gains.

• MACD is still positive but starting to lose momentum. RSI has hooked upwards again, suggesting that there could be a final leg upwards before this uptrend turns and heads lower.

• We would prefer to sell into strength as the shooting star pattern last week would likely induce further selling in the coming days. Support is seen at S$5.23 and S$4.84.

Venture offers high value-added and highly efficient manufacturing services to MNCs using state-of-the-art manufacturing process technology and test development capability. In addition, Venture provides an excellent range of premanufacturing services including design, prototyping and engineering services, as well as post-manufacturing services including after-sales repairs, customisation and fulfillment logistics.

Chartered Semiconductor (CSM SP; S$0.135) – BUY

• Chartered crossed its minor resistance last week and poised to see a tad more upside this week.

• However, looking at its indicators, the stock’s upside appears limited. The MACD is rising but remains in the negative territory while the RSI is also on the rise. A breakout above S$0.145 could see the stock rise up to test S$0.16 next.

• However, if it fails to clear the S$0.145 hurdle, sellers would likely come in droves. Avoid buying aggressively at current levels and keep a tight stop at S$0.12. Support is seen at S$0.125 and S$0.09.

Chartered is one of the world's leading semiconductor foundries. It provides comprehensive wafer fabrication services and technologies to semiconductor suppliers and systems companies.

Midas Holdings (MIDAS SP; S$0.515) – SELL

• Although the stock has broken out of its medium term downtrend channel lately, we are not convinced about the breakout. The candles lately suggest indecision around current levels. Only a close above the S$0.59 resistance would confirm the breakout run is underway.

• Indicators remained positive although there are signs of a slowdown in momentum.

• Investors should do well selling into strength for now, possibly near its resistances at S$0.54 and S$0.59. If the candlesticks fail to hold above the support trend line at S$0.47, expect further selldown towards the next support at S$0.425 and S$0.39.

Midas is a leading manufacturer of aluminium alloy extrusion products and polyethylene pipes, primarily for the transportation and infrastructure sectors in the People's Republic of China.

Chartered Reached yellowline

Called for potential rebound on 19 Mar at $0.10-0.105.... good profit... take loh.

Buy Golden Agri, Straits Asia - Sell Chartered

Golden Agri-Resources (GGR SP; S$0.30) – BUY

• The stock has broken out of its triangle pattern which is a positive sign. However, we still need confirmation before turning bullish. A rise above yesterday’s high of S$0.305 is the signal.

• Indicators are improving on the daily chart. MACD has just confirmed its golden cross while RSI also rises towards the upper band of the neutral zone.

• Once the S$0.305 is taken out, next resistance is at S$0.34 and S$0.38. Initial support is seen at its 30-day SMA at S$0.285 followed by S$0.27. Cut loss if prices fall below S$0.26.

Golden Agri-Resources Limited cultivates, harvests, processes, distributes, and sells crude palm oil and palm kernel. The Company also refines crude palm oil into cooking oil, margarine, and shortening for sale and distribution.

Straits Asia Resources (SAR SP; S$0.845) – BUY

• The stock may have bottomed out at S$0.56 in Nov-08 and is currently enjoying a short rally. However, it needs momentum to drive prices above the S$0.875 resistance trend line to instil more positives into the stock. Next upside target is at S$0.905.

• Technical landscape remains conducive. MACD is gaining momentum while RSI is neutral, suggesting more room to the upside.

• Investors looking for values may want to accumulate near its support at S$0.79. Cut loss if it breaks below S$0.74.

Straits Asia Resources Limited, through its subsidiary, mines for thermal coal on Sebuku Island.

Chartered Semiconductor (CSM SP; US$0.115) – SELL

• Still on its recovery path after broke down of its 30-day SMA. Although aggressive traders may see bargain hunting opportunities in it, we believe it is too early to conclude the selldown.

• It should at least close the S$0.125 gap before we would change our bearish view to a bullish one. Support is still weak at S$0.095 and S$0.07.

• However, indicators are showing improving trend. MACD is poised to stage a positive crossover while RSI is also rising. Upside is likely capped by its S$0.125 and S$0.15 resistances.

Chartered Semiconductor Manufacturing Limited provides comprehensive wafer fabrication services and technologies to semiconductor suppliers and manufacturers of electronic systems. The Company also produces digital logic, analog, and memory chips for applications as multimedia, communications, computing, and networking.

CSM very interesting chart

Chartered = $0.115 really gone up by 2 bids

Sell CSM Chartered, Yanlord, Midas

Chartered Semiconductor (CSM SP; S$0.205) – SELL

• Still stuck in a sideways trend. When it broke below its 30-day SMA, it was already showing signs of weakness. The long black candle is bearish as well.

• The support at S$0.175-0.18 is likely to be tested soon. Breaking below could send the bulls into hiding.

• Daily MACD is negative and so is its RSI.

• Changing to a sell call with a downside target of S$0.175-0.18 for now. Upside is likely capped by its S$0.255 and S$0.30 resistances.

Chartered Semiconductor Manufacturing Limited provides comprehensive wafer fabrication services and technologies to semiconductor suppliers and manufacturers of electronic systems. The Company also produces digital logic, analog, and memory chips for applications as multimedia, communications, computing, and networking.

Yanlord Land (YLLG SP; S$0.74) – SELL

• In the short term, the stock is likely to trade within its downtrend channel. As it is also below its 30-day SMA, the stock could continue to ease to test support at S$0.67-0.685 next. The following support is at S$0.60-0.62.

• Technical indicators are showing mixed signs. MACD has confirmed its golden cross but its RSI stayed negative.

• Sell into strength for now with resistance seen at S$0.80-0.83. Only breaching these two resistances that the stock could turn bullish again. Buy only on breakout above the S$0.83 support. Otherwise, traders should sell and stay out for now.

Yanlord Land Group Ltd is a real estate development company. The Company develops high-end residential property projects in the Peoples Republic of China.

Midas Holdings (MIDAS SP; S$0.395) – SELL

• It has fallen below its descending consolidation triangle. We continue to remain bearish on the stock despite the short bounce recently. It could retest the recent low of S$0.33 again soon. Breaking below could see the stock fall to S$0.28-0.29 levels next.

• Both indicators remained negative. The RSI has now turned neutral from its oversold position suggesting that there is room on the downside afteryesterday’s hook down.

• Any rebounds should be seen as opportunity to get out. Resistance is seen at S$0.41-0.435 and S$0.475.

Midas Holdings Limited designs, manufactures, and installs polyethylene (PE) pipes. The Company also designs and manufactures aluminum alloy extrusion products.

Chartered Semiconductor (CSM SP; S$0.305) – BUY

The stock has rallied and breached its S$0.30 resistance after building a base above its 30-day SMA for a couple of weeks.

Its MACD has reconfirmed its bullish crossover while its RSI is still rising.

There should be a tad more upside for the stock with the next resistance at S$0.34 and S$0.375. We think this rebound could peak somewhere between these two resistances as the RSI is very close to its overbought region. Maintain buy for now but take profits on rally towards the said resistances or a break below S$0.26, which is a sign that the momentum is weakening.

Bank of America Tells Clients to Buy Shares of Seven Semiconductor. This explains why Chartered was up as one of them

Taiwan Semiconductor Manufacturing Co. and United Microelectronics Corp. were among the seven semiconductor makers raised to “buy” by Bank of America Corp. on the prospect the stocks will rally in 2010 on stronger demand for electronics.

The shares are cheap after tumbling last year and are poised to gain in the next 12 months as the recession ends and sales rebound, wrote analyst Daniel Heyler in a research report. Revenue at chip producers will likely grow more than 40 percent in 2010, he said.

“The industry is far healthier due to far fewer players and lower capital spending,” Heyler said. “This should enable the sector to recover as demand recovers.”

The Philadelphia Semiconductor Index plunged 48 percent in 2008, its worst year on record, as the economy shrank and the biggest financial crisis since the Great Depression forced investors to raise cash. In five months, the economy will start growing as government policies spur spending, according to the median economist estimate from a Bloomberg poll.

Taiwan Semiconductor, the world’s largest custom-chip maker, was raised to “buy” from “neutral,” while United Microelectronics, the second biggest, was lifted to “buy” from “underperform.”

The Hong Kong-based analyst also boosted his rating on Chipbond Technology Corp., ASM Pacific Technology Ltd. and Kinsus Interconnect Technology Corp., to “buy” from “underperform.”

He also lifted Chartered Semiconductor Manufacturing Ltd. and Advanced Semiconductor Engineering Inc. to “buy” from “neutral” and increased his recommendation on Semiconductor Manufacturing International Corp. to “neutral” from “underperform.”