Daily Commentaries 4th Oct 06

The KLCI continued its tight range trading yesterday with top gainers coming from stocks with overseas exposure. The major corporate news today is the possible takeover of Road Builder by IJM Corporation at over RM3.00 per share following the off-market transactions over the last two trading days. Meanwhile, Genting has strengthened its hold in Stanley Leisure by increasing its stake to 31.7%. Heavyweight, Telekom’s operations in Cambodia has ended with its deletion from Cambodia’s trade list. OYL has confirmed the 45.2% acquisition by Daikin, which has been approved by the EU’s relevant regulatory authority. The slowdown in the automotive sector proves to be challenging for UMW Holdings, which indicate that it is not on target to sell 100,000 units of vehicles this year. On the regional front, the resignation of Thailand’s deposed prime minister, Thaksin Shinawatra, should have minimal impact on the local and regional economies. The lack of fresh catalysts and weak buying momentum has failed to push the KLCI to close at the resistance at 970. Trading may remain sideways despite the strong performance of the Dow and continued decline in oil prices to US$59. Reduce holdings on strength and accumulate at support of 966.