Friday, October 21, 2011

KLCI slips at mid-morning on mild profit taking

KUALA LUMPUR: The FBM KLCI extended its losses at mid-morning on Friday, Oct 21 as investors wary of the eurozone debt crisis took profit ahead of the weekend meeting of European leaders for signs of progress in resolving the region's debt crisis.

Asian shares were mixed, with most bourses gingerly clinging on to mild gains in thin trade.

The FBM KLCI slipped 1.84 points to 1,439.34 at 10am, weighed by losses at select blue chips.

Gainers edged losers by 173 to 167, while 196 counters traded unchanged. Volume was 358.72 million shares valued at RM161.34 million.

At the regional markets, Japan's Nikkei 225 edged up 0.08% to 8,689.04, Hong Kong's Hang Seng Index up 0.09% to 17,999.88, South Korea's Kospi jumped 1.45% to 1,831.34 and Singapore's Straits Times Index added 0.46% to 2,706.38.

Meanwhile, the Shanghai Composite Index shed 0.24% to 2,325.66 and Taiwan's Taiex fell 0.28% to 7,224.10.

European leaders said they did not expect Sunday's meeting to give an all-cure solution to the euro zone's debt problems, with regional leaders still sharply divided over how to strengthen a euro zone rescue fund, according to Reuters.

France and Germany said in a joint statement on Thursday that the leaders will discuss in detail a comprehensive solution to the euro zone crisis at the summit on Sunday but no decisions will be adopted before a second meeting to be held by Wednesday at the latest, it said.

BIMB Securities Research in a note Oct 21 said that with Greece already choking on declining liquidity, the European leaders were still deliberating on the finer details of the bailout fund now estimated totalling '1.3 trillion.

Reassurance that more details would be revealed over the next 2 weeks had calmed the nervy investors as Wall Street managed to reverse earlier losses to close 37 points higher despite a sea of red over in Europe, it said.

Asian bourses also saw persistent profit taking as most ended in negative territory yesterday, it said.

'Domestically, the FBM KLCI was rather resilient with some late buying support ending the session 9 points down at 1,441.18.

'We reckon selling may be prevalent again taking cue from the shaky regional bourses. Next support level is seen at 1,430 level,' it said.

Meanwhile, Maybank Investment Bank Bhd head of retail research and chief chartist Lee Cheng Hooi in a note to clients on Oct 21 said due to the US markets' mixed tone last night, there may be a shaky tone for the local index ahead of the weekend.

'Some profit taking activities could keep the local market softer today,' he said.

On Bursa Malaysia, PPB was the top loser at mid-morning and fell 22 sen to RM16.58; Genting PLANTATION []s fell 10 sen to RM7.39, Petronas Dagangan and DiGi lost 18 sen each to RFM16.10 and RM31.42, MISC and HLFG eight sen each to RM6.62 and RM11.32, Tradewinds Plantations six sen to RM3.19, Ajiya and Genting five sen each to RM1.63 and RM9.95, while Konsortium fell four sen to RM1.22.

Gainers included BAT, United Plantations, YTL Cement, WCT, Bursa, Dolomite, Airasia, Bina Goodyear and Notion Vtec.

The actives included TMS, IRCB, Ingenuity Solutions, Tejari, JCY and YGL.

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