Wednesday, July 21, 2010

Can FBM KLCI test the 1,350 level?

KUALA LUMPUR: Sustained buying interest in blue chips saw the FBM KLCI about to test the 1,350 level on Wednesday, July 21, as investors sentiment was shored up by the firm close on Wall Street.

Among Southeast Asian markets, optimism about the regional economy saw Indonesia hitting a record high and Thailand around two-year highs following record export numbers for June.

Investors were still cautious over results for European bank stress tests due out on Friday, one reason for late
retreats by equities in the region, dealers said.

At Bursa Malaysia, the FBM KLCI rose 3.35 points better at 1,341.02, but off the intra-day high of 1,345.

A dealer said that Wall Street, boosted by Apple's better-than-expected earnings, created a spillover effect on regional bourses.

"The FBM KLCI picked up another 4.32 points on Tuesday and got closer the 1,350-level. It looks like the index is ready to run back above the 1,340-level," said OSK Research. It added that there would be a tough resistance at the 1,350 point-level. The research house put immediate support at the 1,332 point-level.

An analyst said consumer stocks were in focus while some banking counters remained among the favourites on expectation of strong second quarter growth. "Prospects of good financial results in the upcoming reporting season should provide positive signs for the market as well," he said.

PLANTATION [] counters, especially those related to oil palm cultivation, also attracted buying interest as oil prices rose above US$78 per barrel after a report showed US crude supplies had fallen less than expected last week.

The FBM Emas Index added 25.32 points to 9,095.91, the FBM Ace Index rose 26.89 points to 3,803.51 and the FBM70 [] Index increased 33.90 points to 9,145.44.

The Finance Index surged 40.54 points to 12,161.11, the INDUSTRIAL INDEX [] increased 4.77 points to 2,657.56 and the Plantation Index went up 48.76 points to 6,345.85.

Gainers outnumbered losers by 442 to 298 while 277 counters were unchanged. Turnover was lower at 874.875 million shares worth RM1.268 billion. - Agencies

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