Malaysian shares are likely to gain today as investors venture into the market on a string of better than expected earnings results although lower close on Wall Street might spur some profit-taking. “The market has been lagging other regional stock markets this year but that is changing with yesterday’s higher close.
I expect the market to breach 1,050 points,” said a dealer with a local investment bank. “Earnings this quarter have been within expectations and even outperforming forecasts, so most of the bad news flow might be over this time around and the second quarter could be much better.
The dealer picked Malaysia’s largest planter Sime Darby as buy due to more attractive valuations compared to its peers and construction play Gamuda, which closed much higher on expectations of jobs under the recent stimulus package.
US stocks fell yesterday, led by financials in a late-stage sell-off, after the Federal Reserve gave a more pessimistic view on the economy, tempering hopes for a quick recovery. The Fed cut its 2009 forecast for GDP and raised its outlook for unemployment, undercutting recent optimism that the economy might be turning the corner.
The Dow Jones industrial average fell 52.57 points, or 0.62 per cent, at 8,422.28. The Standard & Poor’s 500 Index lost 4.64 points, or 0.51 per cent, at 903.49. The Nasdaq Composite Index was off 6.70 points, or 0.39 per cent, at 1,727.84. -- Reuters