Tuesday, February 8, 2011

Plantations, big caps lift FBM KLCI

KUALA LUMPUR: The FBM KLCI extended its gains on Tuesday, Feb 8 in line with the firmer overnight close at Wall Street, as well as on continued bargain hunting on blue chips after the pre-Chinese New Year selldown.

The 30-stock index rose 5.17 points to 1,540.77 at mid-morning, lifted by select blue chips and index-linked PLANTATION []-related stocks. Gainers led losers by 287 to 205, while 248 counters traded unchanged. Volume was 838.36 million shares valued at RM367.49 million.

At the regional markets, Japan's Nikkei 225 rose 0.32% to 10,626.03, South Korea's Kospi was flat at 2,081.79 and Hong Kong's Hang Seng Index opened 0.1% higher at 23,576.97, while Taiwan's Taiex fell 0.22% to 9,125.66 and Singapore's Straits Times shed 0.06% to 3,190.20.

China markets are still closed for the Chinese New Year holidays and will resume trade on Feb 9.

Maybank Investment Bank Bhd head of retail research and chief chartist Lee Cheng said the current rebound phase on Bursa Malaysia may still attract some selling.

Key levels to surpass were 1,541.16 and 1,549.75 {50% and 62% respectively of the recent high (1,576.95) ' low (1,505.36) move, he said. The next key level to surpass is 1,558.64, he said.

'Then only we would have confirmation of a re-test of the 1,576.95-level. Else, we would meander in a long drawn-out correction phase.

'Due to the firm US markets last night, we may see the FBM KLCI in a firm technical posture today that may attack the suggested retracement and resistance levels above,' he said.

Meanwhile, BIMB Securities Research said Wall Street closed higher, the longest winning streak since the last few months, boosted by M&A activity and encouraging corporate earnings announcement.

M&A activity in the O&G industry pushed the benchmark index to pass its psychological level and the market momentum in the next few days looks good thus far, it said.

'Note that total 72% companies reported earnings that beat analyst expectations and many would see that would be a record for this results season.

'Given this encouraging Wall Street momentum, expect the local market to trade in positive momentum especially at the full blown of domestic corporate earnings season,' said BIMB Securities in a note Feb 8.

On Bursa Malaysia, among the major gainers were Axiata that added six sen to RM5, Maybank, Genting, Petronas Chemicals and Tenaga rose four sen each to RM8.84, RM10.94, RM6.34 and RM6.19 respectivel.

Among plantations, PPB gained eight sen to RM17.08, IOI Corp three sen to RM5.81 and Sime Darby two sen to RM9.35.

Other gainers included MTD Capital, Tradewinds, Sindora, Bursa, Kretam, Dayang and Kulim.

DFZ Capita was the top loser, down fell 16 sen to RM3.78; Yokohama fell 10 sen to 62 sen, S P Setia lost six sen to RM6.33 respectively.

Compugates was the most active with 79.12 million shares done. The stock added half a sen to seven sen.'' Other actives included Karambunai, Iris, SAAG, Talam, Palette and Mulpha.

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