Kuala Lumpur shares close lower as crude oil fall hits plantation stocks
-UPDATE 6/9/2006
- Share prices closed lower, with plantation
stocks hardest hit in late trade by the fall in crude oil prices, dealers
said.
Plantation stocks had earlier been bought up on hopes that higher crude
oil prices would lead to increased usage of biodiesel fuel.
The Kuala Lumpur Composite Index (KLCI) was down 7.45 points or 0.77 pct
at 956.39.
Dealers said the index may consolidate further with investors awaiting
fresh catalysts to emerge.
The FTSE Bursa Malaysia 30-large cap was down 54.33 points or 0.87 pct at
6,200.56 and the second board index was down 0.48 points or 0.58 pct at 82.23.
Trading volume was 415.84 mln shares valued at 780.33 mln rgt.
Losers outnumbered gainers 513 to 215, with 312 stock unchanged and 273
counters untraded.
A local brokerage dealer said the fall in crude oil prices provided an
excuse for profit-taking after recent rallies.
"The easing of crude oil prices was just an excuse," the dealer said.
Ang Kok Heng, chief investment officer at TA Asset Management, said he
expects demand for biodiesel to continue to grow and fuel a rise in palm oil
prices, saying the supply of palm oil is likely to remain tight.
However, for now, he added that share prices of major palm oil producers
may stay at current levels as they reflect the companies' fundamentals.
IOI Corp, Malaysia's largest palm oil producers in terms of market
capitalization, fell 1.00 rgt or 5.75 pct to 16.40, Kuala Lumpur Kepong lost
0.20 rgt or 1.72 pct to 11.40 and PPB Oil Palms was down 0.10 rgt or 1.24 pct
at 7.95.
Meanwhile, Malaysia's industrial output data for July is due out
tomorrow, with economists expecting the industrial production index to
register faster growth in line with the July exports figure released
yesterday.
Industrial output in June rose 7.0 pct year-on-year and was up 1.7 pct
from May, according to data issued by the department of statistics.
"We expect the (July) numbers to be good," said Wan Suhaimie, an
economist with K&N Kenanga, adding that he expects the July industrial output
to grow by 7.2 pct year-on-year.
Genting fell sharply amid speculation that the gaming operator has made a
bid for Stanley Leisure PLC. The stock was down 0.70 rgt or 2.75 pct at 24.
80. Resorts rose 0.10 rgt or 0.86 pct to 11.70.
BAT (Malaysia) fell 0.50 rgt or 1.18 pct to 41.75 as investors worried
that a rise in cigarettes' retail prices may hurt sales.
Proton was steady at 5.05 rgt, showing no apparent reaction to a
government statement that it expects to launch a reform plan by year-end in a
bid to help a turnaround plan for the national car maker.
Shell Refining Co was lower on easing crude oil prices, falling 0.10 rgt
or 0.93 pct to 10.70 and Petronas Dagangan was steady at 4.16 rgt while Esso
Malaysia bucked the trend by rising 0.32 rgt or 10.32 pct to 3.42.
AirAsia was sharply higher on news that the budget airline has made a bid
for the Kuala Lumpur-Singapore route. The stock rose 0.04 rgt or 3.05 pct to
1.35 while national carrier Malaysia Airlines fell 0.02 rgt to 3.00.
Blue chips Maybank lost 0.20 rgt or 1.75 pct to 11.20, Tenaga lost 0.05
rgt or 0.54 pct to 9.15 and Telekom Malaysia dropped 0.05 rgt or 0.55 pct to
9.00.

For tomorrow...Short for any rebound near 960 points...

For CPO market may try to climb to 1580 points before correction...

Regard

Anthony Wong