Midday Market KLCI rises 0.2% amid cautious sentiment

Business & Markets 2013
Written by Chong Jin Hun of theedgemalaysia.com
Thursday, 05 December 2013 12:47
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KUALA LUMPUR (Dec 5): The FBM KLCI rose 3.52 points or 0.2 % amid
cautious sentiment on the US' quantitative easing measures and the KLCI's
expensive valuation. From a technical point of view, analysts said the KLCI is in
overbought territory, hence anticipation of investors taking profit.
At 12.30pm, the KLCI settled at 1,825.42. This came on gains in stocks like IOI
Corp Bhd and Genting Malaysia Bhd.
"Given the mildly overbought technical momentum, blue chips should meet
profit taking resistance as the index climbed higher, while potential for a soonerthan-
expected US stimulus reduction program should dampen near-term market
sentiment," TA Securities Holdings Bhd wrote in a note today.
The KLCI's expensive valuation is closely watched. M&A Securities Sdn Bhd
research head Rosnani Rasul wrote in a note today that the "current valuation
of 17.5 times is too expensive and not justified in our view".
"Given the inevitable and before the selling pressure from the broader market
spark, we advise investors to take profit," Rosnani said.
Bursa Malaysia saw some 564 million shares worth RM663 million changed
hands. Despite the KLCI's gains, the whole exchange saw more decliners at
290 entities versus 261 gainers.
The top gainer was Hong Leong Financial Group Bhd while Dutch Lady Milk
Industries Bhd led decliners.
The most-active stock was Sumatec Resources Bhd.
This week, Malaysia will announce its October external trade data tomorrow (December 6).
Across Asia today, Japan's Nikkei fell 0.45%. In China, Hong Kong's Hang Seng declined 0.32% while the Shanghai Composite was
0.12% lower.
Reuters reported that Asian markets were off to a nervous start on Thursday as never- ending speculation about the fate of U.S. stimulus
lifted bond yields, while Japanese shares tried to find their footing after taking a spill.
After suffering the biggest one-day fall in six weeks on Wednesday, the Nikkei was up 0.1 percent in early trade thanks in part to demand
from foreign brokers.