Daily Commentaries 23rd May 07

The KLCI closed at another historical high, signaling optimism on the health of the government’s revenue and continued strengthening of the Ringgit. Regional markets also ended the day on a positive note. Interest in Ranhill should continue today as the firm is said to be finalising talks with Trans-Peninsula Petroleum Sdn Bhd to develop a US$7bn oil pipeline project across northern Peninsular Malaysia. Further consolidation in the telco industry can be expected as Time Engineering is ready to sell its shares in Time dotCom to resolve its debt, while Telekom has further sold its stake in Dialog. Details on lower LCC terminal charges is anticipated to be announced today while notable corporate results were released last evening: OSKVI, MRCB, CCM, KFC, BERNAS and MOX. Meanwhile, the Second Finance Minister has stressed that the government will not bail out Proton and is still seeking a strategic partner for it while KFC clarified that it has no knowledge of any fresh bid for the shares of QSR Brands. The local bourse will likely react positively to the positive local macro newsflows as well as DPM’s assurance that there are no plans for an increase in fuel prices. Resistance level remains at 1,370 points.