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Tuesday, November 30, 2010

ZLBT's Morning Markets Round-up

Malaysian Shares May Face Renewed Pressure The Malaysian stock market turned right back to the upside again on Monday, one session after it had ended the two-day winning streak in which it collected nearly 10 points or 0.7 percent. The Kuala Lumpur Composite Index finished just above the 1,495-point plateau, although now investors are bracing for a soft start when the market opens on Tuesday.

The global forecast for the Asian markets remains cautious on persistent concerns over debt woes in Europe and tensions on the Korean peninsula. Airlines, telecoms and technology stocks are likely to fall under pressure, although the oil and financials stocks may provide a bit of support. The European and U.S. markets finished lower, and the Asian bourses are also expected to trend to the downside.

The KLCI finished barely higher on Monday as gains from the financial shares and industrial issues were largely pared by selling from the plantation stocks.
For the day, the index added 3.90 points or 0.26 percent to finish at 1,495.95 after trading between 1,474.02 and 1,495.95. Volume was 1.05 billion shares worth 1.93 billion ringgit. There were 463 decliners and 293 gainers, with 274 stocks finishing unchanged.

Among the actives, Petronas Chemicals, KNM Group, Karambunai Corp, CIMB, Sime Darby all finished higher, while Maybank ended lower.

Irish Rescue Plan Fail To Lift Dow
The markets draw a negative lead from Wall Street as stocks ended Monday's session mostly lower but were able to recover from steep losses in the final hour of trading. Worries about Portugal and Spain's potential debt woes after news of a bailout for Ireland failed to keep stocks firmly negative on the day, as optimism regarding a continued U.S. economic recovery based on retail sales moderated the downside.

After discussions over the weekend, European finance ministers reached an agreement for an 85 billion euro financial assistance package for Ireland. Around 35 billion euros will go toward propping up Ireland's banking system, while the remaining 50 billion euros will cover the day-to-day financing of the state.

Nonetheless, the resolution did little to instill confidence that bond vigilantes won't target similarly challenged Portugal and Spain, prompting some early-day losses among stocks. Noted economist Nouriel Roubini encouraged Portugal to accept assistance before a crisis sets in, but he suggested that Spain was too large an economy to be bailed out by its neighbors.
The Dow Jones Industrial Average (DJIA – 11,052.49) spent a healthy part of the session with a triple-digit deficit, but pared its losses as the session progressed, ending on a loss of 39.5 points, or 0.4%. Eighteen of the Dow's 30 blue chips finished lower, led by Hewlett-Packard (HPQ) and Home Depot (HD), while financial concerns American Express (AXP) and Bank of America (BAC) paced the 11 advancing equities; meanwhile, Procter & Gamble (PG) finished right where it began.
The S&P 500 Index (SPX – 1,187.76) settled with a loss of 1.6 points, or 0.1%.
The broad-market barometer was the lone index to explore positive territory, but ran into a wall at its 10-day moving average. Finally, the Nasdaq Composite (COMP – 2,525.22) also pared its deficit in the final hours of trading, giving up 9.3 points, or 0.4%, by the close. Nevertheless, the tech-rich index maintained its perch atop its own 10-day trendline.

In the U.S., the economic calendar was light, although a number of key reports are due out over the course of the week. November's employment report and the results of Institute for Supply Management's manufacturing survey are likely to be in focus.

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