Daily Commentaries 27th Sep 06

The KLCI closed positive +0.22 points, off its low of 960.85 yesterday. As anticipated, BNM has kept the OPR unchanged at 3.5% and inflation is expected to decelerate. MAS announced some management changes to enhance the company’s performance while the Minister of Energy, Water & Communications has called for a stop to the speculation on the Power Purchase Agreement, at least until the Energy Policy is concluded. Meanwhile, Maxis is heating up competition with plans to spend RM2.85bn until end-2009 to become the nation’s second telecoms provider. The M&A move by Kumpulan Hartanah Selangor and Kumpulan Perangsang Selangor may spur trading interest. On the capital market front, Khazanah is likely to issue a US$750m Islamic exchangeable bond, which could be converted into Telekom shares. The local market is likely to remain range bound despite the stronger performance of the Dow Jones overnight buoyed by growing confidence in the economy and declining oil prices. Support remains at 957 level.