The Malaysian market managed to stay on an even keel on June 2, despite the initial profit taking, but late buying pushed the KL Composite Index into positive territory again.
The market may display similar trends again on June 3, depending on external newsflow. The broader market has been mixed with equal number of buyers and sellers. There has been no massive profit-taking as the rally, now in its fourth month, is still driven by liquidity.
CIMB Equities Research, in its note on June 2, had upgraded its end-2009 KLCI target from 1,060 to 1,220 after removing the 10% discount to its three-year moving average price-to-earnings of 15 times.
“We maintain our Overweight stance on Malaysia and our preference for cyclical bombed-out sectors including construction, building materials, property and oil & gas,” it said.
On the commodities front, light crude oil slipped to below US$68 per barrel while crude palm oil futures fell RM29 to RM2,591 per tonne.
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