CI powers ahead after breather

  • Business
  • Thursday, 29 May 2003


AFTER taking a breather on Tuesday, the KLSE Composite Index (CI) powered ahead yesterday with a 1.8% or 11.9-point gain to 664 on strong buying by foreign funds and active retail participation. 

Well-known foreign fund managers' favourites were actively traded, among these Maxis Communications Bhd, Resorts World Bhd, Public Bank (foreign tranche), YTL Corp Bhd and SP Setia Bhd

Volume ballooned to 378.9 million shares from 249 million on Tuesday. 

Regional markets also headed higher yesterday. The Jakarta Composite Index climbed 2.6% or 12.5 points to 492.8, South Korea's Kospi Index jumped 14 points or 2.3% to 628.4, Singapore's Straits Times Index climbed 13.3 points or 1% to 1,338.6, and the Hang Seng Index rose nearly 90 points or 1% to 9,510.6. 

The recent flow of good news – US Federal Reserve chairman Alan Greenspan's positive remarks on the American economy, the rise in US consumer confidence and the progress made in containing the Severe Acute Respiratory Syndrome (SARS) outbreak – had apparently contributed to the positive sentiment in Asia. 

Dealers said Asian markets, including the KLSE, benefited from foreign program-buying lately. 

TA Asset Management senior general manager Ang Kok Heng noted that investment interest had switched back to equity markets in Asia, which had been badly battered in recent months. 

“The stock markets in Asia are catching up with Wall Street, which had started to rally earlier,'' he added. 

Moreover, another local fund manager pointed out, the depreciation of the ringgit against other currencies – such as the euro, and the Singapore and Australian dollars – had made Malaysian equities more attractive to foreign fund managers now. 

Many local fund managers who had been positioned ahead of a market run-up are clearly riding on the upswing on the KLSE. 

“We've positioned well ahead, as we are comfortable that there is limited downside risk in the market,'' said KLCS Asset Management executive director Connie Ong. 

Looking ahead, however, fund managers remain cautious about the sustainability of the uptrend on the KLSE, having experienced external shocks, one after another, in the past two years. 

Ang said he was awaiting the opportunity to take some profit after the recent sharp gains on the KLSE, given the unclear picture of a US economic recovery. 

“We are not bearish but we are cautious,'' he added. 

Arab-Malaysian Corp Bhd, whose associated company, AMMB Holdings Bhd, is currently in merger talks with EON Capital, topped the list of most active stocks yesterday. The counter was up 6.5 sen to 99.5 sen, with 11.5 million shares changing hands. 

Public Bank (foreign tranche) was another actively traded stock, rising 11 sen to RM2.73. Among the day's big gainers were semiconductor stocks MPI and Unisem, up 50 and 40 sen respectively to RM13.10 and RM6. 

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