Wednesday, June 15, 2011

FBM KLCI rises above 1,550-level at mid-morning

KUALA LUMPUR: The FBM KLCI rose above the crucial 1,550-point level at mid-morning on Wednesday, June 15 following the overnight higher close at Wall Street.

However, the initial rebound at most key regional markets appeared to be short-lived as China's stock markets opened lower after the central bank surprised the market with a rise in banks' reserve requirement ratio (RRR) after the market closed on Tuesday.

The FBM KLCI gained 5 points to 1,553.51 at 10am, lifted by gains including at Tenaga, Petronas Gas and Petronas Dagangan.

Gainers led losers by 238 to 135, while 215 counters traded unchanged. Volume was 200.50 million shares valued at RM262.79 million.

At the regional markets, Japan's Nikkei 225 was up 0.14% to 9,561.30 and Singapore's Straits Times Index edged up 0.16% to 3,062.13.

The Shanghai Composite Index lost 0.47% to 2,717.18, Taiwan's Taiex fell 0.48% to 8,786.96, Hong Kong's Hang Seng shed 0.05% to 22,483.97 and South Korea's Kospi edged down 0.03% to 2,076.14.

Maybank Investment Bank Bhd head of retail research and chief chartist Lee Cheng Hooi in a note to clients on June 15 said that due the US markets' firm tone last night, there would be some initial low volume buying activities on the local bourse today.

'The market could possibly gap-up, with a slim chance of follow-through buying.

'As a result, we expect the FBM KLCI to remain range bound today with late afternoon profit-taking activities. Investors should trade the market with a short-term time frame,' he said.

Meanwhile, BIMB Securities Research said while better economic data and a technical rebound pushed the Dow Jones Industrial Average higher yesterday, the bigger issue was the ongoing debate over the US debt ceiling which stood at US$14 trillion.

'Until a clearer picture arises, the US economy is expected to remain lackluster with unemployment sticking out like a sore thumb.

"On the local front, we still believe that selective accumulation on blue chips to persist with the FBM KLCI to trend above the 1,550-level again,' it said on June 15.

Among the gainers, Tenaga and Paramount rose 19 sen each to RM6.79 and RM5.98, Aeon added 18 sen to RM7.19, Aeon Credit 17 sen to RM5.0, Ta Ann 12 sen to RM5.74, BJ Toto eight sen to RM4.39, MISC, QSR and Bina Goodyear added seven sen each to RM7.18, RM5.86 and 87 sen respectively, Petronas Gas six sen to RM12.18 and Petronas Dagangan two sen to RM16.02.

Losers included BAT, Lafarge Malayan Cement, Paos, Sunway City, PPB, United U-Li Corp and Fiamma.

Actives at mid-morning included Key West, Asia EP, KUB, CBSA, Focus, Karambunai and EON Capital.

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