A rally on the US stocks and Asian bourses drove the FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) to a 52-week high of 1,218 on Thursday.

Dealers said renewed confidence of a global economic recovery will also spur interest for the FBM KLCI futures.

During the week, the FBM KLCI futures traded mostly higher and ended on a good note, tracking the steadier cash market.

Dealers said although the market next week will see shorter trading hours due to the Hari Raya holidays, the positive uptrend would stay.

The market will re-open on Wednesday after the Hari Raya holidays.

On a week-to-week basis, September 2009 contract rose 11 points to 1,221.5, October 2009 gained 12 points to 1,222, December 2009 increased 13 points to 1,220.5 and March 2010 rose 12.5 points to 1,214.

Turnover for the week was higher at 18,557 lots from 23,698 lots last week while open interests rose to 17,000 contracts from 16,570 contracts.

– BERNAMA

Overall, market sentiment remains positive as the global economy showed signs of recovery.

” However, the market could come under selling pressure next week after the FBM KLCI’s recent sharp gains,” said one dealer, adding that investors would remain sidelined ahead of the Hari Raya public holidays.

On a week-to-week basis, the September contract rose 28.5 points to 1,210.5 while October 2009 climbed 30.5 points to 1,210.

December 2009 advanced 31.5 points to 1,207.5 while March 2010 shored up 32 points to 1,201.5.

Overall, turnover for the week was higher at 23,698 lots compared with 18,311 lots transacted last week.

Open interest rose to 16,570 contracts from 14,873 contracts recorded previously.

– BERNAMA

At 12.30pm the benchmark composite index was up 3.93 points to 1,177.59.

Regional markets, however, were mixed at midday.

Tokyo’s Nikkei 225 lost 0.20% to 10,194.30 while Seoul’s Kospi Index was marginally lower, slipping 0.12% to 1,611.57.

Shanghai’s A share Index added 0.20% to 2,850.75 and Hong Kong’s Hang Seng Index rose 0.53% to 19,867.37.

Singapore’s Straits Times Index slipped 0.17% to 2,594.05.

At Bursa Malaysia, 240 counters were up, 232 were down while 221 were traded unchanged. There were 285.6 million shares done at a total value of RM420.12 million.

Among the top gainers Genting jumped 13 sen to RM6.94, RHB Capital rose 11 sen to RM4.88, Proton added 10 sen to RM3.19 and Bursa was up 8 sen to RM7.67.

Heavyweights Maybank rose 8 sen to RM6.48, BCHB added 4 sen to RM10.26 and Axiata increased 1 sen to RM3.10.

Plantation stocks IOI Corp added 1 sen to RM5.04, Sime Darby rose 1 sen to RM8.24 and PPB lost 2 sen to RM15.36.

Nymex crude oil in electronic trade was up 28 cents to US$68.24 per barrel.

Spot gold lost 65 cents to US$991.20 per ounce.

The ringgit was quoted at 3.5285 to the US dollar.

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.

Weekly turnover ballooned to 5.310 billion units worth RM7.326bil, versus 3.401 billion shares valued at RM5.023bil done a week ago.

Technical indicators: The daily slow-stochastic momentum index had indicated a mild topping out pictogram at the overbought territory. It flashed a short-term buy at the neutral zone on July 9.

Similarly, the 14-day relative strength index climbed steadily from the 44 points level on Monday to the 84 points mark on Thursday before pausing.

In stark contrast, the daily moving average convergence/divergence histogram continued to expand upward against the daily signal line to stay bullish. It triggered a buy in mid-week.

Elsewhere, weekly indicators were notably positive, with the weekly slow-stochastic momentum index calling for a buy and the weekly MACD resuming the upward expansion against the weekly trigger line.

Outlook: Bursa Malaysia bounced back to life after spending slightly more than a month adjusting and consolidating the recent huge market rally, boosted by a fine rally in overseas markets, brought about by the better-than-expected corporate earnings report in the US, thus fuelling optimism of a global economic recovery.

Apparently, the key index had penetrated the upper horizontal line of the 13-day rectangular box and thereafter, charging ahead to erase the June 12’s rally peak of 1,095.91 to achieve a near 12-month high of 1,121.66 yesterday.

The convincing breakthrough signals the birth of a new bullish wave. With trading volume on the rise and investors confidence continuing to creep back into the market place, they are likely to give the FBM KLCI a further boost going forward.

However, investors should take note that, unlike an initial phase of the bulls rally, which was steep and massive, the second wave of the primary market’s upward thrust could be a different ball game altogether, where one may see greater profit-taking activities along the way, meaning, the journey ahead may be more volatile and the speed of ascend much slower compared to the previous round.

Technically, the daily and weekly MACDs are painting a promising landscape, suggesting a firmer trend ahead. Therefore, investors can consider accumulating more, especially near the support level should there be any profit taking retracement.

Resistance can be expected at 1,140-1,142 points band, at 1,150 points, 1,165-1,170 points range and the next, at 1,200 points psychological level.

Initial support is seen at 1,100 points, followed by the 1,083 points. The lower floors are resting at 1,058-1,060 points, at 1,040 points and 1,028.14 points.

The benchmark FTSE Bursa Malaysia Kuala Lumpur Composite Index rose 15.62 points or 1.39 per cent to 1,136.52. In the broader market, gainers outperformed losers 2.3 to 1 on volume of 465.44 million shares valued at RM666.56 million (US$186.35 million). — BT ONLINE

At 5pm, the benchmark index closed 12.02 points higher at 1,120.90. About 939.3 million shares changed hands, valued at some RM1.45bil. Gainers outpaced losers by 295 to 277 while 277 counters were unchanged.

Far East Holdings Bhd was the top gainer, rising 50 sen to RM6.20, while Bumiputra-Commerce Holdings Bhd and BAT added 25 sen each to RM9.95 and RM45 respectively. Genting rose 15 sen to RM5.75 and EON Capital Bhd added 16 sen to RM4.80.

Boustead Heavy Industries Corp Bhd rose 16 sen to RM4.58 while Malayan Banking Bhd advanced 15 sen to RM6.10.

The top loser for the day was Amtel Holdings Bhd. The counter lost 27.5 sen to 50.5 sen. Concrete Engineering Products Bhd lost 22 sen to RM2.88 while PPB Group down 20 sen to RM12.30. KNM Group was the most actively traded stock with 1.23 million shares done. The counter lost 2.5 sen to 82.5 sen.

Elsewhere in the region, the Singapore Straits Times Index closed 27.41 points higher at 2,428.43 while Hong Kong’s Hang Seng Index gained 443.79 to 18,805.66 points.

The Shanghai and Shenzhen Index added 6.00 and 8.01 points to 3,189.74 and 1,084.39 respectively. Japan’s Nikkei 225 ended 51.16 points higher at 9,395.32.

Gainers were ahead of losers 398 to 304 with 229 counters unchanged. Some 1.67 billion shares were traded, valued at RM2.14bil.

Gains on Bursa Malaysia were led by blue chips PPB Group Bhd, Amtel Holdings Bhd, Malaysian Pacific Industries Bhd (MPI) and Puncak Niaga Bhd

PPB’s share price jumped 50 sen to RM12.50 on volume of 2.7 million shares. Amtel rose 28 sen to 78 sen while MPI closed 20 sen higher at RM5.35. Puncak advanced 16 sen to RM3.12.

Sime Darby Bhd, the country’s biggest planter gained 10 sen to RM7.45.

Analysts expected retail investors to continue to focus on laggards should the benchmark index be sustained above 1,100 points. Going forward, analysts expect trading volume would continue to improve.

However, some analysts cautioned that the equity market could remain volatile due to expectations of weak domestic economic data and the upcoming corporate results season.

The Malaysian Institute of Economic Research has downgraded Msia’s GDP to -4.2 from -2.2 earlier on fragile business and consumer confidence.

Elsewhere in the region, the Singapore Straits Times Index closed 9.25 points higher at 2,398.67 while Hong Kong’s Hang Seng Index gained 103.21 to 18,361.87 points.

The Shanghai and Shenzhen Index fell 4.81 and 1.47 points to 3,183.74 and 1,076.38 respectively. Japan’s Nikkei 225 ended 74.91 points higher at 9,344.16.

The exchange will introduce a trimmed down market benchmark called the FTSE Bursa Malaysia KLCI on Monday. The new index consisting selected top 30-counters will replace the old 102-strong KL Composite Index (KLCI).

The KLCI closed 6.02 points lower at 1,072.69 on its last day. The new FBM KLCI, which is essentially the re-branding of the existing FBM 30 index, will start at a reference price based on KLCI’s Friday close.

The exchange is expecting a “seamless” transition on Monday.

In the market, shares in IJM Corp dropped 50 sen, or 8.6% to RM5.30 on volume of 3.1 million shares transacted. Lafarge Cement sagged 25 sen, or 4.2% to RM5.75.

Another KLCI constituency that did not make the cut for FBM KLCI, chipmaker Malaysia Pacific Industries saw its share price down 23 sen, or 4.6% to RM4.82.

Malaysian American Electronics Industry, a grouping of major semiconductor players in the country, today projected industry sales this year would decline by 27.5% to RM54.6bil.

Meanwhile, crude palm oil futures on Bursa Derivatives tumbled to a three-month low on Friday, on worries that demand seemed to be slacking as the industry enters its peak production cycle.

The most active contract slumped as much as 4.1% to a low of RM2,085 in mid afternoon trade. It was down RM45 at RM2,130 per tonne as at 5.09pm

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.

It said the opening index value on July 6 will be based on the KLCI closing value on Friday, July 3.

For example, if the KLCI closes on Friday, July 3, at 1,000 points, the index will open on Monday, July 6 at 1,000 points.

The computation of the index will then be based on the 30 constituents, it said.

Subsequently with the transition, the existing FTSE Bursa Malaysia Large 30 Index will be retired on July 6.

Following the transition, the FTSE Bursa Malaysia 100 Index will be known as the FTSE Bursa Malaysia Top 100 and its features will remain unchanged.

Financial products using the FTSE Bursa Malaysia Large 30 Index or KLCI, such as the FBM30etf, Kuala Lumpur Composite Index Futures (FKLI) and the Kuala Lumpur Composite Index Options (OKLI) will adopt the FTSE Bursa Malaysia KLCI as its underlying index with effect from July 6, it added.

As part of the FTSE Bursa Malaysia Index Series, the FTSE Bursa Malaysia KLCI will be reviewed every June and December by an independent index committee for compliance to the Ground Rules of FTSE Bursa Malaysia index series.

– BERNAMA