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Categories
| FBM KLCI rebounds smartly |
| Business & Market 2009 | |||
| Written by Insider Asia | |||
| Friday, 31 July 2009 17:44 | |||
 After two days of losses, the local stock market rebounded smartly on Friday, July 31 taking its lead from Wall Street’s gains. The benchmark index started off very strong on Friday, but succumbed to some pre-weekend profit-taking activities in the afternoon. A late spurt of buying lifted it back to its earlier highs. The FBM KLCI index surged as much as 16 points early in the morning, but pared two-thirds of those gains in the afternoon session before a late spurt of buying lifted it 14.2 points higher at 1,174.9. Market breadth was positive with advancing stocks beating declining ones by a 2.3-to-1 ratio at the close. A total of 1.26 billion shares changed hands. Actively traded stocks include KNM, Ramunia, Handal, SAAG, Mobif, Iris and Bumputra-Commerce. Major gainers include CCB, BAT, Bumputra-Commerce, PPB, and Tanjong plc. Losers include Hong Leong Bank, Public Bank, NSTP and Star. Friday’s gains helped the benchmark index recoup total losses of about 12 points on Wednesday and Thursday, as investors were then roiled by fears of credit tightening measures in China which sparked a sell-off in global stocks and commodities. However, confidence improved on Friday, led by Wall Street’s overnight gains as investors cheered more better than expected results, this time from Sony, and bought ahead of expectations of better second-quarter GDP data to be released on Friday. Commodity prices also recovered strongly. The GDP data is expected to confirm the US economy falling at a much slower pace in the second quarter, with expectations of a contraction of 1.2% compared with a 5.5% slide in the first quarter. With most major results out of the way in the US, investors are likely to return to focus on economic data, to assess the recovery ahead. Elsewhere, economic data is still patchy in Japan. On Thursday, the government said industrial output rose 8.3% in the April-June quarter from the January-March period -- the biggest on-year jump since 1953. However, on Friday, data released showed the jobless rate in June rising from 5.2% to 5.4%, the highest level in six years, while consumer prices fell at a record level for the month. Japan's core consumer price index fell 0.2% in June, or 1.7% lower than a year earlier. Back home, the earnings season will become busier in August. This will provide leads for investors as to the health of the domestic economy and corporate sector – which has been relatively resilient despite the severity of the crisis in developed countries.
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