Daily Commentaries 6th Oct 06

The KLCI did indeed make an attempt at the 970 pts level but it was a distant target and the market closed with a respectable gain of 4.83 pts. Lower liners recorded a comeback of sorts with Iris and Mobif rising by 19.5% and 20.6% respectively. Newsflow is thin for today with corporate announcements including Scomi proposing to issue up to RM630m worth of Islamic bonds as part of its refinancing exercise and Ayer Molek calling off its rights and bonus issues. Malaysia’s export growth for August was up strongly at 14.8% y-o-y which may help to shore up sentiment together with statements from the Bank Negara governor who stated that inflation could average less than 3% in 2007. Rumours continue to surround Ramunia with the latest being Sime’s application to acquire Ramunia’s preference shares at a discount to its normal shares. Nonetheless, our market should be more dependent on overseas catalysts to point the direction for today with US market again inching higher to another record high. Oil prices also look comfortably supported by possible Opec production cuts if prices fall further. As such, our market looks set to make another attempt at the 970 resistance level today. Support is at 966 pts.