KL shares likely to trend higher

Bursa Malaysia is likely to trend higher next week on stronger regional
sentiment and a strong performance of the ringgit following an influx of
foreign funds and an accommodative stance from Bank Negara Malaysia.


Affin Investment Bank vice president and head of retail research Dr
Nazri Khan said with the political overhang out of the way, the local
market should gradually move higher on global liquidity, play catch-up
and narrow the gap with regional peers given its recent
underperformance.


"The local benchmark FBMKLCI is expected to hit the 1,800 level (led
by properties and construction sectors) as the focus shifts to the
continuity of pro-economic growth policies following

the win of the incumbent government on May 5," he told Bernama.


Nazri said the local market should also get support from the central
bank's decision to stand still at its latest monetary policy meeting,
leaving the overnight policy rate (OPR) unchanged at three per cent.







"Amidst the still benign inflation, the pause in the policy rates should be supportive of higher equity prices," he said.


On the technical front, he is pegging immediate resistance at
between 1,800 points and an all-time high of 1826.22, while support is
estimated at between the 1,740 and 1,720 levels.


Meanwhile, during the week just ended, blue chips extended
profit-taking correction while trading momentum shifted to lower liners
and small-cap stocks on rotational play such as Cliq Energy, LBS,
Karambunai, Olympia and Johan Holdings, he said.


Nazri added the market breadth continued to be positive as average
daily gainers led losers five to two on robust trade averaging 2.1
billion shares worth RM2.4 billion per day.


On a Friday-to-Friday basis, the benchmark FBM KLCI ended 77.61 points firmer to 1,772.38.


The Finance Index increased sharply by 854.89 points to 16,706.38,
the Plantation Index jumped 361.89 points to 8,325.50 and the Industrial
Index rose 119.08 points to 2,955.10.


The FBM Emas Index surged 655.74 points to 12,212.71, the FBMT100
soared 614.34 points to 12,020.26, the FBM Ace Index chalked up 450.15
points to 4,352.27 and the FBM Mid 70 shot up 1,064.58 points to
13,825.96.


Weekly turnover rocketed to 11.54 billion shares worth RM17.29
billion from last week's 3.23 billion shares worth RM7.97 billion.


Main market volume more than tripled to 10.43 billion shares valued
at RM17.08 billion from 2.78 billion shares valued at RM7.87 billion
last week.


The ACE market volume rose sharply to 767.35 million shares worth
RM123.16 million from 106.21 million shares worth RM10.30 million
previously.


Warrants decreased to 328.44 million units valued at RM39.47 million
from the previous week's 337.338 million units valued at RM66.747
million.-- Bernama