MARKET SUMMARY
The local bourse hit a psychologically important mark of 1,300 points at 4pm last Friday before ending the week at 1,299.8 points — still marginally higher than the previous week’s close of 1,270.78 points.

The FBM KLCI extended its gains at the beginning of the week on positive news flow about the domestic economy. Trading was centred on blue chips, the satisfactory 4Q2009 earnings of which buoyed investor confidence.

Last Thursday Bank Negara Malaysia raised the overnight policy rate by 25 basis points to 2.25%, the first hike in almost four years. It said the rise was justified given the significant improvement in the domestic economy and moderate rise in inflation.

OSK Research head Chris Eng does not expect major market-moving news this week as investors await the unveiling of the New Economic Model at the end of the month.

He says global markets, however, will continue to be volatile, underpinned by Greece’s debt woes and Thai protests. On the domestic front, political developments may impact the local bourse’s performance, although the effects will not be major.

For this week, TA Securities chartist Stephen Soo pegs the support level for the FBM KLCI at 1,288 points and resistance level at 1,320 points.

Most Asian bourses rose last week as US economic data turned out better than expected, especially on the manufacturing front and private sector jobs market.

Singapore’s Straits Times Index rose 39.43 points from 2,750.86 points the previous Thursday to close at 2,790.29 points last Friday.

Japan’s Nikkei 225 closed at 10,368.96 points last Friday, which was an increase of 242.93 points from its close of 10,126.03 points the previous Thursday.

Hong Kong’s Hang Seng Index ended last Friday at 20,788 points, up 179.3 points from the previous Thursday while the Shanghai SE Composite Index ended the week 20.83 points higher at 3,031.07 points.

This article appeared in Capital page of The Edge Malaysia, Issue 796, Mar 8 - 14, 2009.