High Oil Price Expected, conflict in middle east persist

Kuala Lumpur shares close mixed as profit-taking pares 9MP-driven gains -
UPDATE 19/07/2006
- Share prices closed narrowly mixed, with the
composite index barely supported by gains driven by the government's
announcement late yesterday of the 15 bln rgt first phase of a five-year
Ninth Malaysia Plan, dealers said.
The gains were pared by profit-taking, but the market held on to positive
territory as expectations that inflation pressure in June was under control
provided additional support, they said.
The official consumer price index figures for June were released after
the market close, showing the CPI up 3.9 pct year-on-year, after a similar
growth in May.
The Kuala Lumpur Composite Index (KLCI) closed up 3.30 points or 0.36 pct
at 911.98, off a high of 913.78, while the Second Board Index shed 0.20
points to 90.72.
The mining sub-index was the biggest gainer, rising 8.81 points or 2.33
pct to 387.67 while the construction index was the biggest sectoral loser,
falling 0.97 points or 0.62 pct to 155.11.
Total trading volume was 885.17 mln shares valued at 1.02 bln rgt.
Losers outnumbered gainers 392 to 322, with 302 counters unchanged and
299 stocks untraded.
At the close, the ringgit was quoted at 3.6940/6990 to the dollar,
compared to yesterday's closing quote of 3.6810/6840.
"Profit-taking has definitely shown its ugly head and is showing signs of
accelerating tomorrow, ahead of fresh leads. For the market to remain
positive, I believe a further news flow on the new projects announced under
the 9MP needs to be forthcoming in the near future," a local brokerage dealer
said.
He said market direction remains unclear as it could turn either way,
judging from the cautious stance by investors and uninspiring volumes
today.
TA Securities said the local stock market's technical rebound from the
recent sharp two-day fall, while looking promising in terms of market
breadth, could fizzle as profit-taking and selling on strength are bound to
check its upside potential.
The brokerage house said the persistently large KLCI futures discount is
another bearish factor for the upside, while technical momentum indicators
continue heading south.
"However, on the external front, the overnight rebound in US stocks,
lifted by a dip in crude oil prices, may aid a recovery in regional markets,"
TA added.
Among blue chips, Tenaga Nasional, Telekom Malaysia and Malayan Banking
closed flat at 9.10, 9.05, and 10.40, respectively.
Construction stocks were lower on profit-taking following earlier gains
on news of the new public works projects under the 9MP. UEM Builder was down
0.01 rgt at 1.22, UEM World fell 0.02 rgt to 1.66, and MTD Infraperdana lost
0.09 rgt to 1.06. Gamuda recouped earlier losses to close flat at 3.54.
Magnum Corp Bhd rose 0.07 rgt to 1.96 on its attractive valuation
following a recent sell-off.
TSR Capital Bhd was up 0.06 rgt at 1.99 after the company said it had won
a 3 bln rgt construction project.
REDtone International Bhd inched up 0.02 rgt to 0.655 despite a
government decision to cancel the WiMAX license tender.
At the close, three-month interbank rates were quoted at 3.90/92 pct,
while the overnight rate was quoted at 3.45/50.

For tomorrow...we see big chance of profit taking aktivity...SHORT KLOFF when high...target 895 points in near term...

For CPO Market...range bound trade expected...Short when high and Long when low...

Regard

Anthony Wong