CIMB's shares price rises
CIMB's share price rose after a research house upgraded the bank's outlook following the unexpected move by the US Federal Reserve to refrain from commencing tapering initiatives.
At 11.01am, CIMB rose 20 sen, or 2.63 per cent to RM7.80 with 8.14 million shares changing hands.
Alliance Research in a research note today said CIMB's share could overshoot its target price as it rides on a relief rally following the move by the Fed to continue its asset purchasing programme at the current pace.
"CIMB is a good proxy to ride on the short term due to the recent steep sell down of its stock. It remains a hot favourite among foreign investors and has high volatility," it added.
It said compared to its banking peers, CIMB relatively underperformed during the recent market correction, with the share price falling by 11.2 per cent from the recent high of RM8.56 in late July.
"We believe that the steep sell down is mainly due to the high foreign shareholdings reduction from 40.6 per cent recorded at end-July to 37.9 per cent in end-August, the challenging operating environment in its Indonesia operations and high beta," it added.
Alliance Research upgraded its recommendation for CIMB to 'trading buy' from 'neutral', while maintaining the target price at RM7.99.
It said despite a limited upside potential to the target price,
CIMB's share could overshoot it, riding on inflows of foreign funds to regional markets.-- Bernama