KLCI extend gains 20 April 2009

Investor confidence in equities remains on relatively firm ground at the start of the week. Stock markets worldwide have rallied strongly since early-March, chalking up very strong gains over a short period of time.

The closely watched Dow Jones Industrial Average and the broader-based Standard & Poor’s 500 index have now stringed together six consecutive weeks of gains. Hence, many are expecting some degree of correction in the near term. Whilst there have been a sprinkling of more upbeat data, underlying fundamentals have not changed much and the global economy remains in bad shape. However, buying interest has been surprisingly strong. Asian markets opened mixed on Monday, but inched broadly higher as the day progressed.

Most of the relevant bellwether indices in key Asian markets ended the day in positive territory.

Similarly, the KL Composite Index opened on a negative footing. Profit taking drove the benchmark index as low as 957.6 points in the earlier part of the day. But sentiment improved, particularly after the break where select blue chip gains lifted the KLCI into the black. The benchmark index closed higher for the eight consecutive trading day at 968.4 points.

Market breadth, however, remained negative throughout the day. At the close, there were seven losing stocks for every five gaining ones. Trading volume too contracted sharply. Little over 796 million shares were traded, compared to the daily average of more than 1.43 billion shares last week.

KNM was the most heavily traded counter. The stock closed 1.5 sen higher at 54.5 sen. Other actives include the renounceable rights for Axiata shares, UEM Land, Chin Well, DRB-Hicom and SAAG.Proton was the top gainer for the day. The stock added 34 sen to close at RM2.99. The national carmaker launched its latest model, the Exora multi purpose vehicle (MPV), last week. It is expected to boost sales.

HAPPY TRADING2ALL