Daily Commentaries 27th May 2008

It was another case of a cautious start for the local market after oil prices hit US$132 per barrel last Friday and the Dow taking another beating that culminated in the broader but somewhat restrained sell-down on the local bourse yesterday. The KLCI closed a tad weaker at 1273.37 BNM has kept the OPR unchanged at 3.5% while HeiTech landed a RM20m ICT job from the government. Initial works for the takeover of 4 companies involved in water distribution and production by the Selangor State government has been completed with pricing being the the next hurdle to overcome. In terms of results, both Proton and Kulim registered strong quarterly numbers. On balance, with US markets closed, we would expect the KLCI to extend its range bound trading pattern with concerns still on oil. The index should oscillate within the support and resistance zones of 1270-1305.