Kuala Lumpur shares close flat ahead of US rate decision - UPDATE 8/8/2006
- Share prices closed flat, with the benchmark
index shifting slightly into positive territory after being confined in a
tight range, while trading volumes remained thin as investors cautiously
awaited the outcome of tonight's Federal Open Market Committee (FOMC)
meeting, dealers said.
The Kuala Lumpur Composite Index ended the day up 0.60 points at 939.08.
The FTSE Bursa Malaysia large-cap 30 Index was up 5.54 points or 0.09 pct
at 6091.27.
The second board index was down 0.34 point or 0.38 pct at 89.26.
Losers outnumbered gainers 341 to 298, with 359 stocks unchanged and 319
counters untraded. Trading volume was 425.58 mln shares
Dealers said investors remained wary despite higher-than-expected June
industrial output growth, and support for the benchmark KLCI was provided
only by interest in select blue chips.
A local fund manager said that in the immediate term, the market's upside
is likely to be capped by profit-taking, with resistance seen at 940-945
points.
Notwithstanding the higher-than-expected June industrial output growth
rate, analysts expect the country's economic growth to slow in the second
half due to high oil prices and as US economic activity loses steam.
"Our view remains cautiously optimistic, we don't think the government's
target of 6.0 pct GDP growth is achievable," Wan Suhaimie, an economist at
K&N Kenanga, said.
Meanwhile, Malaysia's central bank governor Zeti Akhtar Aziz was quoted
by Bernama news agency as saying that domestic economic growth is likely to
remain steady in the second half.
As long as the inflation rate remains under control, the interest rate
will be kept steady, she said.
The central bank will hold its sixth monetary policy meeting on August
25, the outcome of which is likely to be influenced by the US Fed rate
decision later tonight, dealers said.
Banking stocks, which are interest rate-sensitive, ended the day broadly
lower, with Maybank down 0.10 rgt at 10.70, Hong Leong Bank down 0.10 rgt at
5.20 and Public Bank down 0.05 rgt at 6.65.
Among blue chips, MISC-O1 gained 0.10 rgt to 8.45 on volume of 819,300
shares. Tenaga was steady at 9.15 rgt on 2.53 mln shares, while Telekom
Malaysia firmed 0.05 rgt to 9.10 on 1.47 mln shares.
Degem ended the day sharply higher as investors cheered the company's
decision to pay out a special interim dividend of 33 pct. The stock was up 0.
115 rgt or 12.17 pct at 1.06.
Landmarks rebounded from yesterday's sharp fall, rising 0.05 rgt or 3.09
pct to 1.67.
PIE Industrial was higher on improved second-quarter to June results,
adding 0.06 rgt or 2.51 pct to 2.45.
Malaysian Plantations, the holding company of Alliance Banking Group was
higher on its stronger first-quarter results, adding 0.04 rgt or 1.95 pct to
2.09.
At the close, the ringgit was quoted at 3.6670/6720 to the dollar,
compared with yesterday's close of 3.6645/6695 .


For tomorrow...market expecting to move down...target 900 points...


For CPO market...profit taking take place...short CPO if reach 1680 points...

Regard


Anthony Wong