Thursday, January 27, 2011

Market snaps losing streak

KUALA LUMPUR: The FBM KLCI snapped its six-day losing streak on Thursday, Jan 27 on some bargain hunting activities, in tandem with the general upbeat sentiment in key regional markets

The 30-stock index closed 0.46% or 6.96 points higher at 1,526.96, lifted by gains including at PLANTATION [] stocks and select blue chips. Gainers led losers by 538 to 238, while 263 counters traded unchanged. Volume was 1.41 billion shares valued at RM2.22 billion.

The Shanghai Composite Index jumped 1.49% to 2,749.15, Japan's Nikkei 225 rose 0.74% to 10,4788.66, Taiwan's Taiex up 0.52% to 9,102.33 and South Korea's Kospi rose 0.22% to 2,115.01.

Meanwhile, Hong Kong's Hang Seng slipped 0.27% to 23,779.62 and Singapore's Straits Times Index shed 0.03% to 3,219.83.

BIMB Securities Research in its market wrap report said regional bourses remained in positive territory'' following stronger-than-expected US home sales, the US President's call for lower corporate taxes and encouraging corporate earnings reported in Japan.

However, it said the Hang Seng was dragged by declines in property and banking stocks after China raised the minimum down payment for the purchase of a second home from 50% to 60% in an effort to curb overheating in its property sector as well as in the economy as a whole.

Maybank Investment Bank Bhd head of retail research Lee Cheng Hooi said the buying on Bursa Malaysia was mainly supported by local funds, adding that the selling by foreign funds had somewhat abated.

'Rebound possibility is there, perhaps to as high as 1,540.'' But possible to head towards support and target of around 1,498 and 1,500. Volume will remain thin,' he said.

Meanwhile, MIDF Research head Zulkifli Hamzah said the rebound in the market today partly exonerated the research house's view that the market had retraced to a level that value cannot be ignored.

'We believe the market this year will be marked by one or two prominent swings, related to macro-level concerns with the current one being China and inflation.

'The uptrend should resume although we are not expecting it before the Chinese New Year. We expect the market to stabilize and consolidate at current level first before the next push,' he said.

Zulkifli also said the downgrade by Standard & Poor's in Japan's sovereign rating was long overdue as the economy was highly leveraged across all segments.

'The downgrade should impart some pressure on yen, which we believe had run ahead of its fundamentals,' he said.

Among the gainers, Batu Kawan rose 48 sen to RM16.78, KLK and BLD Plantations 40 sen each to RM21.30 and RM5.40, Kulim 34 sen to RM13.18, Latexx 22 sen to RM2.80, DiGi rose 20 sen to RM25.30, Petronas Gas 18 sen to RM11.38 while Ibraco and Hap Seng gained 17 sen each to RM1.30 and RM6.47.

Losers included Tahps, MSC, F&N, BAT, KYM and LPI Capital, while Ho Wah Genting was the most actively traded counter with 80.4 million shares done.


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