Monday, February 21, 2011

FBM KLCI succumbs to mild profit taking at mid-morning

KUALA LUMPUR: The FBM KLCI slipped into negative territory at mid-morning on Monday, Feb 21 in line with the overall tepid sentiment at key regional markets that fell on some profit taking activities.

Japan's benchmark Nikkei fell on Monday as profit-taking emerged after a recent surge in the domestic market, with market players saying trading cues would likely turn on developments in the Middle East and China, according to Reuters.

Trade may be thin on Monday due to the Presidents' Day holiday in the United States, and thus any news could make for a volatile market, market players added, it said.

The FBM KLCI fell 6.07 points to 1,511.49 at 10am, weighed by losses at key blue chips.

Losers beat gainers by 414 to 160, while 209 counters traded unchanged. Volume was 471.58 million shares valued at RM357.02 million.

At the regional markets, Japan's Nikkei 225'' fell 0.36% to 10,804.09, South Korea's Kospi lost 0.90% to 1,995.12, Singapore's Straits Times Index was down 0.51% to 3,071.23, Taiwan's Taiex shed 0.07% to 8,837.42, Hong Kong's Hang Seng Index opened 0.4% lower at 23,502.58 while the Shanghai Composite Index managed to edge up 0.03% to 2,900.62.

Maybank Investment Bank Bhd head of retail research and chief chartist Lee Cheng Hooi in a note to clients on Feb 21 said post-Chinese New Year foreign hedge fund liquidation activities have caused the FBM KLCI's downward selling pressure.

The FBM KLCI's price action has turned its chart into a daily downtrend, he said.

'As the price action on its weekly chart created a Bearish Engulfing Candle Pattern a fortnight ago, all rebound rallies may be sold down.

'The first key retracement levels are 1,523.49 (38.2%) and 1,533.69 (50%). 1,533.38 is also a gap-down zone. Failure to clear 1,533.38 would mean a sideward to lower spell towards 1,490.44 again. If the index clears 1,544.35, then it could still face some strong selling at 1,544.35, 1,558.64 and 1,576.95,' he said.

Among the top losers, KLK fell 26 sen to RM21.76, BAT 22 sen to RM46.30, Malaysia Smelting Corp 13 sen to RM4.35, MISC 12 sen to RM8.13, Public Bank, Proton and IJM Corp fell 10 sen each to RM13, RM4.05 and RM6.53 respectively, while MMC Corp, Cycle & Carriage and Maybank lost nine sen each to RM2.85, RM5 and RM8.50 respectively.

Gainers included Tased that rose 45 sen to RM8.35. The company has proposed a bumper dividend, comprising of preference dividend of 6%, ordinary dividend 30% and special dividend 50%.

Other gainers included Tradewinds, Kamdar, Coastal Contracts, Glenealy, Malayan Flour Mills, GAB and Hap Seng.

Ramunia was the most actively traded counter with 22.7 million shares done. The stock added 1.5 sen to 68.5 sen. Other actives included Ho Wah Genting, Palette, Karambunai and Kumpulan Europlus.

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