Daily Commentaries 22nd Nov 06

After the jump in CPO prices the day before, plantation stocks rallied to push the KLCI higher yesterday. For today, results from banks such as RHB Cap and EON Cap were in line while other results from Ranhill, Scomi Marine, Dialog and Maybulk showed strong growth. Big news is related to AMMB with ANZ Bank initiating negotiations to buy a stake in the company, thus competing with US based Newbridge. Greenpacket entered into a collaboration with Unicom Shanghai to offer VOIP services. YTL is among 3 bidders for a majority stake in a Manila water company. Sumatec won a RM20.7m pavement contract for Putrajaya while Ingress secured a RM11.9m contract to supply transformers to Tenaga. Further sweeteners today are statements from the Second Finance Minister who expects the value of M&As to increase next year due to favourable market conditions and overall expectations for reasonable 3Q GDP growth that will be announced tomorrow. Crude oil jumped back above US$60 per barrel thus helping energy stocks to lift US markets. We expect some follow through buying in the KLCI today helped by buoyant results with resistance at 1040 pts. Support is at 1030 pts.