Friday, December 3, 2010

FBM KLCI stays above 1,500-level but gains limited as Shanghai slips

KUALA LUMPUR: The FBM KLCI extended its positive run ''in early trade On Friday, Dec 3 in line with the higher overnight close at Wall Street but ''the gains were limited as the Shanghai Composite Index slipped into negative territory on speculation of tighter monetary policy next year.

US stocks extended their gains on Wall Street yesterday after a stream of positive US retail and housing data raised hopes for a swift recovery in the world's biggest economy.

US retailers reported higher-than-forecast sales for November, while initial weekly claims for jobless benefits fell to a two-year low.

Reuters also reported that China's purchasing managers' index for the non-manufacturing sector fell to a nine-month low of 53.2 in November from 60.5 in October.

It remained above the 50 level, indicating that service industries are still expanding, although at a slower pace, it said.

On Bursa Malaysia, the FBM KLCI was up 2.82 points to 1,506.04, lifted by gains including at KLK, BAT, YTL and Genting.

Gainers led losers by 234 to 164, while 205 counters traded unchanged. Volume was 230.28 million shares valued at RM252.82 million.

Maybank Investment Bank Bhd head of retail research and chief chartist Lee Cheng Hooi in a note to clients on Dec 3 said due to the firm US markets last night, the FBM KLCI may be in a volatile mode, with initial buying activities that may see some profit-taking in the later part of the day.

'Global market trends may have become volatile recently but we may have turned a corner at the 1,474-low as market focus is on the more positive USA economic figures, rather than Euro zone's debt woes,' he said.

Among the early gainers today, KLK was up 56 sen to RM21.54, BAT rose 48 sen to RM44.90, Tradewinds gained 30 sen to RM5.26, Batu Kawan up 28 sen to RM16.30, GAB added 19 sen to RM9.55, APM automotive rose 18 sen to RM5.38, YTL gained 12 sen to RM8.40 while Genting rose eight sen to RM10.48.

Losers included Hong Leong Bank, Lafarge Malayan Cement, RHB Capital, Gamuda, Petronas Gas, Jerneh, Nestle and IJM Corp.

Sinotop was the most actively traded counter with 20.7 million shares done. The stock gained half a sen to 13.5 sen. Other actives included Karambunai, DRB-Hicom and Transmile.

At the regional markets, gains were limited as the Shanghai Composite Index slipped into the red on reports citing an academic advisor to the central bank as saying that China would gradually shift to a tighter monetary policy next year, and that it needed to slow money-supply growth.

The Shanghai Composite Index slipped 0.10% to 2,840.86. '' Elsewhere, Japan's Nikkei 225 was up 0.14% to 10,182.25, Taiwan's Taiex added 0.60% to 8,636.93, Singapore's Straits Times Index gained 0.28% to 3,206.76, South Korea's Kospi was up 0.06% to 1,951.48 while Hong Kong's Hang Seng Index opened 0.4% higher at 23,544.47.

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