KUALA LUMPUR (July 14): The FBM KLCI is likely to extend its gains next week, in line with the slightly improved global investor sentiment.
The FBM KLCI ended last week on a positive note and closed higher on Friday, mirroring the reversal of fortunes at most regional markets, after China's second-quarter gross domestic product data landed in line with forecasts.
The FBM KLCI edge up 0.89 of a point to 1,626.38. Week-on-week, the benchmark index gained 5.83 points.
Global stocks and oil prices surged in a relief rally o n Friday after Chinese data eased fears of a potential hard landing for the world's No. 2 economy and a further blow to growth worldwide, according to Reuters.
U.S. stocks broke a six-day losing streak, and the euro advanced against the dollar for the first time in four days as risk sentiment broadly improved and investors covered bets against the currency, it said.
With a slew of companies set to report results in the US next week, the hope among investors is that the bad news has been factored in, but the broader picture remains lackluster. That may limit the market's gains even if companies clear a low bar, said Reuters.
Affin Investment Bank Bhd vice president and head of retail research DR Nazri Khan said he expects the FBM KLCI to trend higher on rising expectation of more central bank monetary stimulus to counteract worries about fading global economic activity following dramatic interest rate cuts in Brazil and South Korea as well as huge asset purchases by the Bank of Japan (in addition to People’s Bank of China, the European Central Bank and the Bank of England policy action a week before).
On Bursa Malaysia, among the stocks that could be in focus in next week are Maxis Bhd, REDTONE INTERNATIONAL BHD [], Gunung Capital Bhd and Brahim’s Holdings Bhd.
The Edge weekly in its latest edition reported that Gunung Capital bhd would be teaming up with Saudi-based Mohammad Abdulaziz Al-Habib & Sons Holding Co.
The magazine said the tender was in its early stages and Gunung had made pre-qualification submissions.
“This will be a very big project. We have already submitted the pre-qualification documents (on July 11) and we believe it shouldn’t be a problem for us to get through (the pre-qualification stage),” it cited Gunung’s executive director Iskandar Ibrahim as saying.
The Edge also reported that that Brahim’s Holdings Bhd was venturing into sugar refining, a potentially lucrative business.
In an extraordinary general meeting last week, shareholders gave their approval for the company to acquire a 60% stake in Admuda Sdn Bhd, which holds the licence to manufacture refine sugar and molasses in Sabah and Sarawak.
Maxis Bhd and RedTone International Bhd inked an infrastructure and spectrum sharing agreement today that will enable both players to fast track their roll out of ultra-high speed 4G networks throughout the country.
In a joint statement Friday, the companies said this would mean customers will have the opportunity to access the highest 4G broadband speeds in the country - up to 150 Mbps, with the latest 4G LTE TECHNOLOGY [] through the combined spectrum.
Both Maxis and REDtone are looking to launch their 4G LTE services early next year in selected areas of the Klang Valley, with other regions to follow closely thereafter, they said.
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