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News Admin
 
Date
 07/09/2006
News Provider
 Mahamad Rodzi Abdul Ghani
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 NULL
Headline
 Malaysia Hot Stocks-Market seen down on profit-taking

KUALA LUMPUR, Sept 7 (Reuters) - Malaysian shares are likely to ease further on Thursday, led by plantation stocks, as the market consolidates recent gains, brokers said. Losses on Wall Street were also likely to hurt sentiment.

Plantations stocks like IOI Corp and Golden Hope may see further selling on expectations that falling crude-oil prices may hurt demand for palm oil, which is used to make alternative fuels, a dealer with a foreign brokerage said.

The Malaysian government has also warned it might revoke some existing biodiesel licences if the licensees did not build their plants within the set time frames.

The Malaysian plantation index has risen over 30 percent this year, compared with a 6.3 percent rise in the benchmark composite stock index.

Oil prices, which fell below $68 a barrel on Thursday, have fallen 13 percent from their record high of $78.4 on July 14.

On Wednesday, the benchmark Kuala Lumpur Composite Index ended down 0.77 percent at 956.39, a second day of decline after hitting a six-year high on Tuesday. ADVERTISEMENT
 
"I expect it to come back to 945-950 and it's on the way down there," said a dealer with a foreign brokerage.

The September futures contract put the index at 948 points.

U.S. stocks fell on Wednesday, with the Nasdaq posting its sharpest drop in seven weeks, as investors dumped riskier technology and home-building stocks on signs wage inflation may prompt another rise in official interest rates.

The Dow Jones industrial average fell 0.55 percent to 11,406.20. The Nasdaq Composite Index lost 1.72 percent to close at 2,167.84.

FACTORS TO WATCH

- Gaming firm Berjaya Sports Toto posted a net profit of 95.6 million ringgit ($26 million) for the three months ended July 31, down 16 percent from a year earlier. The year-ago result included a gain from the sale of loan stocks.

- Oil and gas services firm Petra Perdana said on Wednesday it had agreed to acquire a new offshore support vessel from S K Line Co Ltd for 44.9 million ringgit. The vessel is expected to be ready for delivery in September 2007, it said.

- Technology firm AIC Corp said on Wednesday it had sold 20 million shares in Jotech Holdings for 17.2 million ringgit or 86 sen per share, through a private placement.

With the sale, AIC now has only 0.62 percent stake in Jotech.

- Malaysia's top mobile phone operator, Maxis Communications , plans to spend some $300 million to expand network coverage in India, the Business Times reported, citing Chief Executive Jamaludin Ibrahim.

- The government may revoke some existing biodiesel licences if the companies do not build their plants within the time frame set, Plantation Industries and Commodities Minister Peter Chin was quoted by the Business Times as saying.

- Palm oil mill maker CB Industrial Product said it had total orders worth 350 million ringgit and this was expected to sustain the company until 2008, the Business Times reported.

- AmMerchant Bank has placed out 11 million cash-settled call warrants in construction firms Gamuda and IJM Corp . Both call warrants have a 12-month maturity and an exercise ratio of one call warrant for one underlying share, which can be exercised at any time during the period.

- The Asian Development Bank has lowered its economic growth projection for Malaysia this year to 5.2 percent from 5.5 percent, and in 2007 to 5 percent from 5.8 percent, on expectations that the U.S. economy and global demand for information technology products will soften.

- Malaysian Rating Corp (MARC) has downgraded corporate debt rating of PECD Bhd's 200 million ringgit Serial Fixed Rate Bonds Programme to A-minus from A with a stable outlook. For full text, please double click on [ID:nKLT004155]

- Malaysia plans to issue callable government bonds and short-term securities by the end of the year in a bid to boost liquidity and develop the market, traders said on Wednesday. For full story, please double click on [ID:nKLR136474]

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