ZLBT Chats

Friday, April 8, 2011

ZLBT Morning Views >>> Bursa Malaysia, Wall Street

Malaysia Shares May See Renewed Consolidation
The Malaysian stock market on Thursday halted the mild two-day losing streak in which it had declined just three points or 0.2 percent. The Kuala Lumpur Composite Index finished just above the 1,560-point plateau, although now investors are bracing for further losses when the market opens on Friday.

The global forecast for the Asian markets suggests consolidation following an interest rate hike by the European Central Bank, as well as another earthquake near Japan. Airlines are likely to continue to decline on rising fuel prices. Properties and steel stocks also are tipped to decline, with commodity plays likely to provide support. The European and U.S. markets finished lower, and the Asian markets are also expected to track to the downside.

The KLCI finished modestly higher on Thursday on gains from the financial shares, industrial issues and plantation stocks.
For the day, the index added 9.04 points or 0.58 percent to finish at 1,556.83 after trading between 1,554.60 and 1,561.93. Volume was 1.575 billion shares worth 2.283 billion ringgit. There were 441 gainers and 352 decliners, with 323 stocks finishing unchanged.

Among the actives, MAA Holdings, Perisai Petroleum, Karambunai, SAAG Consolidated, Maybank, CIMB Holdings, Petronas Chemicals and IOI Corporation all finished higher.

The lead from Wall Street is negative as stocks saw volatility over the course of the trading day on Thursday, with several pieces of significant news tugging the markets in opposite directions. The choppy trading also came as volume remained below average, extending a recent trend. The volatility on Wall Street came as traders digested some typically market moving news, including an interest rate hike in Europe, another earthquake in Japan, and a bigger than expected drop in jobless claims in the U.S.

WALL STREET : Quake Deflates The Bulls;
DJIA Stays Above 12400
The session kicked off on a somewhat promising note today, as stocks flirted with early gains in the wake of stronger-than-expected weekly employment data and a round of robust retail sales reports. By midday, however, the major market indexes were swimming in red ink, thanks to news of another earthquake and tsunami warning in Japan. Reports of the nation's second disaster in less than a month helped gold futures to another record high, while fighting in the Middle East and North Africa -- in Nigeria, specifically -- bolstered crude oil north of $110 per barrel for the first time since September 2008. Meanwhile, budget-related stagnation on Capitol Hill also weighed on the Street, keeping the bulls' late-session rebound attempts to a minimum.

After falling triple digits around midday, the Dow Jones Industrial Average (DJIA – 12,409.49) rebounded off its 10-day moving average, paring its loss to just 17.3 points, or 0.1%, by the close. Furthermore, the blue-chip barometer maintained its foothold atop the 12,400 level, as 12 of its 30 components ended north of breakeven. Home Depot (HD) paced the bullish minority with a gain of nearly 0.9%, while Caterpillar (CAT) led the laggards with a loss of 1%.

Meanwhile, the S&P 500 Index (SPX – 1,333.51) also chipped away at its deficit in afternoon trading, but still surrendered 2 points, or 0.2%, by the time the dust settled. What's more, the broad-market index finished just a hair's breadth shy of 1,333.58 -- exactly double its March 2009 low. Finally, the Nasdaq Composite (COMP – 2,796.14) also pared its losses later in the session, but ran into a familiar wall in the psychologically significant 2,800 region.

Crude Gushes Above $110
Highest Since Sept 2008
Oil futures powered higher again today, topping $110 per barrel for the first time since September 2008. A round of stronger-than-anticipated employment data bolstered hopes for solid demand, while reports of election-related violence in Nigeria exacerbated supply concerns in the Middle East and North Africa. By the close, May-dated crude oil futures added $1.47, or 1.4%, to end at $110.30 per barrel.

HAPPY TRADING

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