Resilient Momentum Keeps KLCI Active

Shares on the local bourse opened broadly lower on April 7 but gained strength as the day progressed.

The KL Composite Index started out in negative territory, falling as low as 913, as investors took profit on gains over the past five consecutive trading days. The benchmark index had risen more than 54 points during this period. Sentiment, however, improved after the break and in particular, in the last hour of trading. The KLCI managed to claw back most of its earlier losses to close just four points lower at 919.8.

Market breadth, on the other hand, stayed in the red throughout the trading day although the ratio of losing to gaining stocks also improved towards the later part of the day. At the close, the number of losing stocks was just marginally ahead of gaining ones.

Market volume was pretty robust with almost 804 million shares changing hands. However, it is worthwhile to note that trading in Maybank-OR accounted for a good 14% of the total volume transacted.

The renounceable rights were allotted to Maybank shareholders under its rights issue exercise on the basis of nine for every 20 shares held. Holders of the rights are entitled to subscribe for Maybank shares at RM2.74 apiece. Maybank-OR closed at RM1.06 while Maybank shares closed at RM3.92.
Some of the other heavily traded counters were KNM, MRCB, Gamuda, E&O, Resorts World, Zelan and WCT. Sime Darby, Genting, Bursa Malaysia, Lafarge Malayan Cement and MISC were among the big gainers for the day. At the other end, Bumiputra Commerce, Maybank and Tanjong plc were some of the bigger losers.

Sentiment on the local bourse will continue to be influenced by movements in the US and regional markets. Investors are a little more hesitant at this point given the strong rally over the last month and are likely to take some money off the table pending further clues on the health of the global economy.