Daily Commentaries 13th Dec 06

The KLCI succumb to profit taking yesterday after most heavyweights staged a strong run over the past few trading days. Top corporate news for today is SP Setia’s commendable FY06 results despite the soft property market and Measat-3 successful launch, boding well for Astro. Meanwhile, Genting’s private placement has been completed and proceeds would be used to finance the Sentosa casino. Bursa Malaysia’s plans to re-introduce regulated short selling in January after postponing it several times this year should be well accepted by the retailers. Kejuruteraan Samudra Timur has confirmed that its major shareholders have received KUB’s proposal for a 32% stake in the company for RM1.30 while E&O informed that the company is not aware of any plans to be taken private. Last night, the FED held interest rates steady for a fourth-straight time, acknowledging that the economy has weakened and the housing pullback has gathered force, but reiterating its concern about inflation. This led to a 12.90 pts fall on the Dow. We may see KLCI consolidating sideways over the short term. Immediate resistance is at the 1110.12 pts followed by the 1138.21 pts level. Support is represented at 1087.37 pts, followed by the 1080 pts and the 1065 pts level.