Market Down Trend May Began
Kuala Lumpur shares close firmer on proposed investments in Johor - UPDATE 31/07/2006
- Share prices closed slightly higher, helped by
news that foreign firms have evinced interest in investing a total of some 15
bln rgt in the Southern Johor Economic Region, dealers said.
They said the market undertone remains firm, with follow-through buying
expected tomorrow.
The Kuala Lumpur Composite Index (KLCI) ended the day up 1.13 points or 0.
12 pct at 935.85.
The second board index lost 0.10 points to 90.24. Total trading volume
was 492.46 mln shares valued at 626.46 mln rgt.
Gainers outnumbered losers 363 to 335, with 315 stocks unchanged and 304
counters untraded. At the close, the ringgit was quoted at 3.6575/6625 to the
dollar.
"The news of large foreign firms interested in investing a large amount
in the Southern Johor Economic Region has definitely boosted market sentiment,
" said EON Capital head of research Pong Teng Siew.
Bernama news agency quoted Prime Minister Abdullah Ahmad Badawi as saying
that several large foreign firms are interested in setting up operations in
Johor, with proposed investments of about 15 bln rgt.
Pong said the news strengthened confidence in the government's
pump-priming measures to boost the economy through the ninth Malaysian plan
(9MP).
"The Johor economic region is expected to create one million new jobs and
business opportunities. The market has definitely something to cheer about
going forward," he added.
TA Securities said in a note to clients that while short-term indicators
suggest potential for profit-taking this week, the trend however points to
further upside in the medium term.
Investors should be looking to accumulate on dips blue chip stocks, which
look poised to move higher going forward, it said.
TA said the central bank's decision last Friday to leave interest rates
unchanged amid easing inflation indicators should provide support during
market dips.
Among key blue chips, BAT Malaysia closed up 0.25 rgt to 42.25, Anway
advanced 0.15 rgt to 6.40, and Kulim rose 0.10 rgt to 3.98.
Tenaga Nasional was flat at 9.15 rgt, Telekom Malaysia was steady at 9.
05, and Malayan Banking fell 0.20 rgt to 10.50.
Bumiputra-Commerce Holdings Bhd was up 0.15 rgt at 6.15 on expectations
the banking group will post a strong set of results for the second quarter to
June.
PPB Oil Palms Bhd was flat at 7.45 on profit-taking after gaining earlier
on its moves to produce biodiesel in Indonesia.
VADS Bhd was up 0.20 rgt at 4.46 after reporting stronger net profit for
the first half.
Kuala Lumpur Kepong Bhd was flat at 11.00 on profit-taking after gaining
earlier on stronger crude palm oil (CPO) prices and improved earnings outlook.
For tomorrow...we see market moving down...Target 900 points...
For CPO...We see more profit taking...near term 1600 points
Regard
Anthony Wong