The bears are back, causing Wall Street to tumble again last night

The bears are back, causing Wall Street to tumble again last night. Key U.S. equity indices slumped between 3.7% and 5.2% at the closing bell on mounting concerns that the global economic recovery would stall while European banks could face capital constraints.

The negative vibes will surely be felt across the region today. Back home, we expect the benchmark FBM KLCI to slip below its immediate support level of 1,495, possibly falling towards the next support mark of 1,465. In terms of corporate development, we may see interest from investors in: (a) Dialog Group, which has proposed a rights issue with warrants (on the basis of 2 rights shares and 1 warrant for every 10 shares held); and (b) Petra Energy, following a media
report saying that its parent Perdana Petroleum is looking to sell its 29.6% stake in the company.

It is going to be a slow trading day on our Malaysian stock exchange today

It is going to be a slow trading day on our Malaysian stock exchange today, much like yesterday (which saw fewer than 900m shares changing hands) as a dearth of fresh market leads is expected to keep most investors on the sideline. On Wall Street last night, key U.S. equity indices ended between flat and marginally weaker (-0.5%).

Similarly, the FBM KLCI will likely show a flat performance ahead to reflect the sluggish investors’ mood. The benchmark index could be moving sideways inside a narrow trading range with its immediate support level seen at 1,495.

Against a broadly quiet market backdrop, Esso Malaysia shares will come under the limelight following the sale of a 65% controlling stake to San Miguel Corporation, which will also be required to extend a mandatory takeover offer at RM3.50 per Esso Malaysia share (versus its last traded price of RM4.95). Separately, MISC is scheduled to announce its latest quarterly results in the evening.

Report from HWangDBS