Daily Commentaries 12th May 2008

Technically speaking, the KLCI is still in a consolidation mode. The technical indicators have yet to show any conclusive trading signals at the moment. Should the KLCI prove able to hold above the 1275/65 immediate support area, the KLCI could re-test the immediate resistance area of 1300/05 in the near-term. However, due to the weak closing of WallStreet in last Friday night, we do not rule the KLCI to temporary stage a mild correction in the beginning of the week. Apart from the US and regional market performance, we also believe the performance of KLCI also hinge on crude oil’s movement. A strong crude oil performance could fuel the performance of oil and gas as well as plantation stocks that collectively accounted for about 30% of KLCI market cap.