Monday, 30 April 2012

KLCI inches higher at mid-morning, brushes off concerns after Bersih rally

KUALA LUMPUR (April 30): The FBM KLCI brushed off events over last weekend arising from the Bersih 3.0 rally and inched higher on Monday, in line with the gains at most regional markets, lifted by select blue chips in early trade.

At 10am, the FBM KLCI was up 3.64 points to 1,571.44.

Gainers led losers by 184 to 151, while 202 counters traded unchanged. Volume was 183.93 million shares valued at RM115.43 million.

Asian shares inched higher on Monday as weaker-than-expected U.S. growth data left open the possibility for more monetary stimulus from the Federal Reserve, but trading will likely be subdued with Japanese and Chinese markets closed, according to Reuters.

Global stocks ended higher on Friday on strong earnings reports, while the dollar dipped as data showed growth in the U.S. economy cooled in the first quarter to a 2.2% annual growth rate, below a 2.5% forecast, feeding views that the Fed could ease policy further to boost growth, it said.

At the regional markets, Hong Kong’s Hang Seng Index rose 1.12% to 20,973.80, South Korea’s Kospi added 0.44% to 1,984.09, while Singapore’s Straits Times index fell 0.20% to 2,975.60 and Taiwan’s Taiex shed 0.27% to 7,460.38.

Maybank Investment Bank Bhd in a market strategy note Monday maintained its Neutral stance on the FBM KLCI and said it expects the market to continue pricing in political concerns ahead of the 13th General Elections (13GE).

It said last Saturday's Bersih 3.0 rally had thrown up the possibility of the 13GE being deferred.

“On the external front, renewed concerns over the Eurozone imply heightened volatility again for equity markets.

“Against such a backdrop, we expect domestic equities to stay range bound ahead of the 13GE, and advise investors to stay selective in their picks,” it said.

BIMB Securities Research said on Monday that in the US solid corporate earnings, improving economic growth and employment had kept investors upbeat on equities hence the higher closing for the Dow Jones Industrial Average at 13,228 (+24 points).

Meanwhile European bourses all closed higher possible on a rebound after an eventful week, it said.

“We believe this as a lull before the storm as the situation in Spain is ripe for traders to manufacture more volatility ahead.

“To recap, the country recently was downgraded by the S&P and recently reported its unemployment rate of 24.4% for 1Q12 should become as a main target to derail sentiments, it said.

The research house said Asian markets were weaker possibly spooked by the situation in Spain amid profit taking activities.

“Locally, the FBM KLCI fell almost 12 points to 1,567 ahead of the Bersih 3.0 Rally as investors continue to pare down their holdings.

“We believe outlook for the local bourse has deteriorated for the 2Q12 unless corporate earnings for the 1Q excel. Next support is seen at 1,560,” it said.

Among the gainers on Bursa Malaysia at mid-morning, Chin Teck added 29 sen to RM9.30, Aeon Credit and Petronas Dagangan up 22 sen each to RM10.38 and RM19.28, Tasek 21 sen to RM8.76, UMW and Carlsberg 14 sen each to RM7.97 and RM11.62, Genting PLANTATION []s 13 sen to RM9.52, Toyo Ink and KLK 12 sen each to RM1.53 and RM23.82, while Petra Energy added 11 sen to RM1.27.

Utopia was the most actively traded counter with 178.28 million shares done. The stock was unchanged at 8.5 sen.

Other actives included DRB-Hicom, XDL, CSL, Berjaya Corp. Daya Materials, Metronic and Oversea.

Decliners included PacificMas, Bumi armada, Dutch Lady, IJM Plantations, Sarawak Plantations, Batu Kawan, GAB and Gadang.

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