Golden Agri-Resources (E5H.SG) is down 3.0% at $0.655 in heavy volume of 221 million shares, falling for the seventh straight session and taking its year-to-date loss to 18.8%.
Selling may be linked to speculation China may cut its soyoil import tax to 1% from the current 9%, while keeping the palm oil tax unchanged at 9%, which may weigh on palm oil prices as Chinese buyers might switch to soyoil; the talk drove CPO futures down as much as 2.6% in Malaysia Thursday.
However, an analyst at a foreign brokerage says, “I’m not aware of anything specifically happening today...of course palm oil prices have been dropping and Golden Agri is a stock which is very highly leveraged to CPO prices, so I’m guessing that’s what is driving the shares down.”
He adds, Golden Agri “is typically a very volatile stock. When it swings up, it swings up more than the others, and when it drops, if drops further.” Peer Indofood Agri (5JS.SG) is down 0.4% at $2.45.
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