Daily Commentaries 1st Dec 06

The market raced ahead yesterday with broad based buying across bluechips and strong volume of 1.58bn. Nonetheless, after 2 days of breathtaking gains, we would advise caution amongst investors lest profit taking be stronger than expected. For today, ANZ Bank agreed to pay RM4.30 per share for an additional 11.4% of AMMB. On the broader economic front, Tesco is tipped to take over Makro’s Cash & Carry stores while Khazanah is taking over the International Medical University for RM98m. TSR Capital signed a MOU with TH Properties SB to buy 528 acres of land to develop a medical city in Negeri Sembilan. Tanjung Offshore finally announced the acquisition of a another 10% stake in its Cendor MOPU while Alam Maritim announced new charter contracts worth RM18.7m for 3 of its vessels and M3nergy announced a 1-for-2 bonus issue. Results which should garner attention include Petronas Dagangan and Lion Industries which both returned to the black, while Proton’s loss widened. US markets were largely flat with the rise in energy stocks offsetting concerns arising from poor retail sales. Still this is enough for us to advise caution for today. The market may just rest on its 1080 pts support level for today with resistance now higher at the 1100 pts level.