Daily Commentaries 4th September 06
OSK Research
Technical View
Contrary to expectations of very little to be unveiled, Budget 2007 proved to be a pleasant surprise for businesses and the average man on the street with broad-ranging incentives accorded (see our Budget report today). The most discerning boost for the stock market (arguably the least the market had expected) was the reduction in corporate tax rates, the first in 9 years. This is a big step forward for Corporate Malaysia and should boost earnings growth whilst serving as a re-rating catalyst. We also laud the broad-ranging initiatives for the laymen, which is a clear articulation of the government’s commitment in making the current economic woes less painful. Other boosters, namely for the construction and property REIT sectors were not unexpected. Aside from the Budget, other major headlines today include MAS raising its fuel surcharge for the forth time this year, New Toyo making a GO for Tien Wah Press at RM2/share and Proton denying that its Cikarang plant in Indonesia is up for sale. With the positive undertone on the market sweetened by the Budget news flows, the market is expected to extend its upward momentum today with new resistance pegged at 965. The Dow closed higher on the first trading day of September last Friday on better-than-expected jobs data for July.
Technical View
Contrary to expectations of very little to be unveiled, Budget 2007 proved to be a pleasant surprise for businesses and the average man on the street with broad-ranging incentives accorded (see our Budget report today). The most discerning boost for the stock market (arguably the least the market had expected) was the reduction in corporate tax rates, the first in 9 years. This is a big step forward for Corporate Malaysia and should boost earnings growth whilst serving as a re-rating catalyst. We also laud the broad-ranging initiatives for the laymen, which is a clear articulation of the government’s commitment in making the current economic woes less painful. Other boosters, namely for the construction and property REIT sectors were not unexpected. Aside from the Budget, other major headlines today include MAS raising its fuel surcharge for the forth time this year, New Toyo making a GO for Tien Wah Press at RM2/share and Proton denying that its Cikarang plant in Indonesia is up for sale. With the positive undertone on the market sweetened by the Budget news flows, the market is expected to extend its upward momentum today with new resistance pegged at 965. The Dow closed higher on the first trading day of September last Friday on better-than-expected jobs data for July.
posted by nomadhunter at 7:49 PM
0 Comments:
Post a Comment
<< Home