Market snaps 2-days of losses, some local fund support seen

by **hlk** Thu 06 Oct 2011, 00:40

KUALA LUMPUR: The FBM KLCI snapped its two days of losses on Wednesday, Oct 5, as local funds were seen buying battered down heavyweights, giving some hope to investors.

The recovery was in line with the key regional markets and European bourses after European finance ministers agreed to safeguard their banks as doubts grew about whether a planned second bailout package for debt-laden Greece would go ahead.

Reuters reported that hours earlier French-Belgian municipal lender Dexia became the first European bank to have to be bailed out due to the euro zone's sovereign debt crisis.

However, Reuters quoted International Monetary Fund's European Department Director Antonio Borges as saying Europe needed 100 billion to 200 billion euros to recapitalise its banks to win back investor confidence and should put in place a comprehensive plan across the continent.

At Bursa Malaysia, the 30-stock KLCI rose 14.29 points or 1.05% to 1,375.67. However, year-to-date, it is down 9.43%. It is down a hefty 222 points from its record high of 1,597.08 on July 11.

Turnover was 697.59 million shares valued at RM1.08 billion. There were 435 gainers, 247 losers and 263 stocks unchanged.

The KLCI futures rose 5.50 points to 1,374.50 for October.

Despite Wednesday’s gains, investors are not all ready to rush in to pick up battered down stocks as Europe and the US economic fundamentals are still shaky. Another bout of bad news would send buyers fleeing again.

Among the 30 index-linked stocks, Axiata rose 16 sen to RM4.80, nudging the KLCI up 3.13 points and Maybank’s 13 sen gain to RM8.01 added another 2.25 points. Sime Darby climbed 16 sen to RM8.42, pushing the index up another 2.22 points.

DiGi rose 34 sen to RM30, MMHE 27 sen to RM5.28 while CONSTRUCTION [] companies IJM rose 20 sen to RM4.74, Mudajaya 18 sen to RM2.20 and Gamuda 16 sen to RM2.96.

PLANTATION []s were among the losers, with PPB down 30 sen to RM15.76, United Plantations 28 sen to RM17.20, BLD Plantations 20 sen to RM5.60, KLK 16 sen to RM20 in lione with the weaker outlook for crude palm oil. CPO futures for third-month delivery fell RM25 to RM2,785.