Investor sentiment was on a firmer footing early May 30 morning. Wall Street's positive overnight close as well as a decline in crude oil prices gave confidence a boost.
The latest reading on the US economy showed a degree of resilience, raising hopes that the recession could be less painful. Meanwhile, crude oil futures on the New York Mercantile Exchange slipped to about US$126 (RM409.50) per barrel, down from record high of US$135 per barrel little over a week ago.
The KL Composite Index opened in positive territory and hung on to gains till the close. Market volume also spiked higher. About 818.4 million shares changed hands Friday, the highest level recorded this month.
The increased trading volume was due, in part, to heavy trading in shares for Gamuda. The stock accounted for more than 16% of the day's total market volume. Its share price plunged nearly 18% on worries about its investments in Vietnam. The stock was the day's top loser.
Credit rating agency, Fitch Ratings, recently lowered Vietnam's sovereign rating on the back of surging inflationary concerns. The property sector, in which Gamuda has exposure, has slumped, as had the stock market and dong currency. Property values could fall further if the government is forced to raise interest rate to rein in inflation.
The benchmark KLCI ended the day sharply higher at 1,276.1 points, for a gain of more than 14 points. Leading the gainers were DiGi, KL Kepong, KNM, PPB and Genting. However, the broader market did not fare as well, reflecting persistent investor concerns over the market's outlook in the near term.
Market breadth was positive in early trading but fell into the red as the day progressed. At the close, losing stocks outnumbered gaining ones by a ratio of roughly five to four. Among the big losers were MPI, IOI Properties, Proton, Nestle, SP Setia and WCT.
Saturday, May 31, 2008
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