Daily Commentaries 17th Jan 07

Appetite for blue chip stocks remained strong. The KLCI stayed above its Monday closing to end a firm 5.2 points up yesterday. However, several regional markets closed lower. Top news headlines today are PM’s assurance that the merger of the PNB-related companies would go ahead, the signing of MOU between Utama Banking Group and Kuwait Finance, which gives Kuwait Finance the right to carry out due diligence on Rashid Hussain as well as the Gamuda’s optimism that the government would award the northern sector of the double-tracking project this month. In addition, Sime Darby Bhd is believed to have won a RM15bn contract to build submarine cables linking Bakun hydroelectric dam to Peninsular Malaysia. Follow through buying on the KLCI is expected driven by the gained on Dow Jones last night, weaker crude oil price as well as the strengthened Ringgit. Immediate resistance for the KLCI is at the 1,138 pts level with support at the 1,121 pts level.