Daily Commentaries 17th Oct 06

As expected, the market did take a slight breather yesterday after recent gains but profit-taking was well absorbed. The KLCI managed to close flat with losers topping gainers 485 to 278. Digi has upped the ante on the telco tariff war with the introduction of one flat rate for all voice calls irrespective of networks, in keeping to its core value proposition. F&N announced the acquisition of Nestle's liquid milk products businesses in Thailand and the latter's 'Tea Pot' brand in a deal worth RM310m. Golden Hope also revealed an RM18.1m JV in China to manufacture, distribute and sell an oleochemical derivative for the production of detergent. Meanwhile, Puncak should continue to fuel interest with the confirmation of a capital distribution of up to 65sen/share in addition to a 1-for-1 bonus issue. With the revelation of few key positive corporate developments coupled with another winning streak on the Dow last night, the market is expected to tread with a positive bias today. No change in the immediate resistance and support levels of 990 and 980 respectively.