TREND ANALYSIS
By K.M. LEE

REVIEW: Bursa Malaysia kicked off the week on a dull note, with the benchmark FBM KL Composite Index (FBM KLCI) losing 0.75 point at 1,067.01 on extended consolidation amid dearth of fresh market-stimulating leads.

Overnight Wall Street eased 36.65 points to 8.146.52 the previous Friday while world crude oil prices sustained downward pressure to below US$60 a barrel. Besides that, the poor showing in Asian equities also was not helping the local sentiment.

Hence, the local bourse drifted sideways to marginally easier in thin volume, touching an intra-day of 1,060.96 on lack of support before bouncing off slightly to end at 1,063.66, down 4.10 points in lacklustre mode on Monday.

Then, overnight Dow staged an unexpected steep rebound, rising 185.16-point to 8,331.68, as bullish analyst comments on the financial sector revived investors’ appetite for stocks.

Apparently, the wake of fresh hopes that US corporate earnings may not be as weak as initially feared, sparked a stock rally in the region and against the bullish backdrop, Bursa Malaysia was not left out this time, which saw the FBM KLCI gaping up a commendable 7.43-point to 1,071.09 in initial deals on renewed buying interest.

Business was robust, with the core blue chips topping the most up list. Elsewhere, other quality issues outside the FBM KLCI radar, also posted decent gains on greater retail participation. At the end of Tuesday’s trading, the key index rebounded some 15.97 points to 1,079.63.

Thereafter, the local sentiment continued to improve, tracking the bullish momentum in offshore stock exchanges on optimism about the global economic recovery story after a couple of giant corporations in the US churned out a better-than-expected earnings result.

Goldman Sachs reported a 33% rise in quarterly earnings, while Intel Corp’s results soared past street’s expectations.

In another hectic day, big advances, led by the banking issues helped push the FBM KLCI up 17.61 points to 1,097.24 in mid-week.

It tacked on an extra 11.64 points to 1,108.88 on Thursday and 12.02 points to 1,120.90 yesterday on follow-through interest, also the best closing level since August last year, spurred by a steadier offshore equities.

Statistics: On a weekly basis, the FBM KLCI advanced 53.14 points, or 5% to settle at 1,120.90 yesterday, against 1,067.076 on July 10.
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KUALA LUMPUR, June 24 (Bernama) — Bursa Malaysia on Wednesday reminded the market that its benchmark index, the Kuala Lumpur Composite Index (KLCI) will adopt FTSE’s global index methodology and will be renamed as FTSE Bursa Malaysia KLCI, starting July 6.

The FTSE Bursa Malaysia KLCI will be free-float adjusted and liquidity-screened to give investors an investable and tradable index which will remain characteristic of the underlying market.

Constituents of the FTSE Bursa Malaysia KLCI will be made up of Bursa Malaysia’s 30 largest eligible Main Board companies initially, the stock exhange operator said in a statement Wednesday.

The computation will be based on investable market capitalisation.

The calculation of FTSE Bursa Malaysia KLCI will be on a 15 second basis compared with 60 seconds adopted by KLCI currently.

This improvement in speed of index calculation will essentially benefit the investors as they will be able to closely track the pulse of trading activities, Bursa Malaysia said.
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KUALA LUMPUR:Maybank Investment Bank Equities Research has reduced its 2009-10 market earnings forecasts by 7.3% and 6.1% and expected corporate earnings to contract by 10.5% in 2009, before recovering to 6.3% growth in 2010.

In its strategy report issued on March 3, it said there could be further downgrades to our its forecast, depending on crude palm oil (CPO) price trends, as well as the timing and level of banks’ non-performing loans (NPL) charge-offs.

The research house said the steep earnings cuts reflected nasty surprises especially towards the season’s last reporting week, with key disappointments emanating from the steel, technology and plantation sectors, as well various large capitalised stocks.

“Three concerns gained prominence in the 4Q08 results season – deep earnings cut as companies frontloaded provisions, significant rights issues by TMI and Maybank, and rising incidences of dividend cuts,” it said.
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KUCHING, Dec 23 (Bernama) – The Sarawak state government and Western Digital Media (M) Sdn Bhd will meet in early January to discuss in detail the closure of the latter’s factory in the Samajaya Free Industrial Zone here which has affected 1,500 workers.

Deputy Chief Minister of Sarawak, Tan Sri Dr George Chan, said the vice president of Western Digital, Datuk Don Blake, in a telephone conversation had agreed to come to Sarawak to find a more effective resolution to the closing of the factory effective March next year.

“I understand that the closure of the factory is a business decision and the state government respects it but there are various issues involving the 1,500 workers that ought to be taken into consideration,” he said at a press conference here today.
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KUALA LUMPUR: Hong Kong and Japan markets skidded more than 4% at the midday break on Tuesday as investors braced for a weakening global outlook.

Over at Bursa Malaysia, Public Bank and its foreign shares and TM International were among the bigger losers while crude palm oil futures fell, tracking the decline on crude oil.

At 12.30pm, the KLCI was down 4.82 points to 843.61, but off the early low of 838, as buying support for heavyweight Tenaga set in to arrest the decline on the 100-stock index.

Turnover was 193.42 million shares valued at RM280.4mil. There were 76 gainers, 261 losers and 160 counters unchanged.
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KUALA LUMPUR - Malaysia is likely to escape a recession next year and post a modest growth despite the global financial crisis due to strong consumer demand and public spending, the central bank said Friday.

“We expect to have positive growth next year,” central bank governor Zeti Akhtar Aziz told reporters.

Malaysia’s top trading partner neighbouring Singapore and Asia’s largest economy Japan are already in a recession.

Zeti said if the global financial crisis does not worsen, Malaysia would post a growth of 3.5 per cent in 2009.

“Domestic demand has become the engine of growth. Our financial system is not facing the financial stress. We have ample liquidity in the system.

“We have no large-scale retrenchments. We are creating jobs. We are in an economy where there is no asset burst,” she added.
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KUALA LUMPUR: Every time a Malaysian motorist pumps petrol into his car these days, the government makes a profit of 30 sen (8 US cents) for every litre. This is a dramatic switch from just months ago when every drop was subsidised by the government.

The old system of government fuel subsidies has been removed, thanks to the sharp falls in global oil prices in recent months, officials say.

The Malaysian government now says that it is considering scrapping the fuel subsidies even if global crude oil prices were to rise again.

“We have stopped subsidising petrol from the time when the pump prices were cut to RM2 per litre,” domestic trade and consumer affairs minister Shahrir Samad said on Tuesday (18 Nov).

At current prices, the government makes about 30 sen for every litre of petrol sold at fuel stations.
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By Soo Ai Peng

KUALA LUMPUR, Nov 13 (Reuters) - Malaysia’s second-largest lender Bumiputra-Commerce Holdings (BUCM.KL: Quote, Profile, Research, Stock Buzz) net profit more than halved in the third quarter as weaker capital market conditions dragged down fee-based operations, the company said on Thursday.

It said the weaker earnings were also due to the absence of an one-off gains from the sale of a subsidiary in the same period last year.

State-controlled Bumiputra-Commerce, which owns significant bank assets in Indonesia and Thailand, said third-quarter net profit halved to 447.96 million ringgit ($124.8) compared to 1.03 billion ringgit in the year-ago period.

Nine-month net profit fell 29 percent to 1.63 billion ringgit from the year-ago period. Net non-performing loan ratio dropped to 3.1 percent of end-September from 4.5 percent a year ago, it said.

Malaysian analysts do not provide quarterly forecasts.

Bumiputra-Commerce’s full-year net profit for fiscal 2008 is expected to drop 15 percent to 2.35 billion ringgit, according to Reuters estimates.
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KUALA LUMPUR, Nov 13 (Reuters) - Malaysia is reviewing rules to allow Islamic financial institutions to short-sell shares in an effort to improve market liquidity and encourage hedging, the market regulator said on Thursday.

With the change, sharia institutions would be able short-sell a limited number of stocks, Securities Commission Chairman Zarinah Anwar said.

Forbes Article

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Motorola Malaysia and Satyam entered into an agreement this week that will see the consulting and information technology service provider acquire some 128 Motorola employees.

The acquisition will require Motorola to will divest from its software development center (SDC) in Cyberjaya, Malaysia and all 128 employees – along with the unit’s assets – will shift to Satyam.

The SDC is part of Motorola’s Home and Networks Mobility business and focuses on network management system development.

The communications behemoth said it aims to create synergies and boost competitiveness in Malaysia and throughout the Asia-Pacific region with the new deal.

“This strategic acquisition will integrate and strengthen Satyam’s product engineering services to Network Equipment Providers and Operators in the areas of element management, mobile solutions, and access networks” said Nishith Mathur, head of Satyam’s Technology Infrastructure business unit.
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