European stocks - Factors to watch on June 29

PARIS, June 29 (Reuters) - European shares looked set for a higher start on Thursday after gains in New York and Tokyo, but equity, debt and foreign exchange investors braced for another U.S. interest rate rise.

Most analysts expect the U.S. Federal Reserve to raise the overnight federal funds rate by a quarter-percentage point to 5.25 percent, although some see potential for a half-point move.

But markets will hang on the Fed's wording in a post-meeting statement as they look for clues on whether the central bank will tighten monetary conditions even further in coming months. The Fed's decision is due at 1815 GMT.

Before that, the publication at 1230 GMT of the final first-quarter gross domestic product and of the core U.S. personal consumption price index, a key gauge for monetary policy-making, will come under scrutiny.

On the corporate front, steel makers may come under pressure after Australia's BlueScope Steel Ltd. (BSL.AX: Quote, Profile, Research) cut its 2006 earnings forecast and said it will axe jobs and shut two plants due to soaring raw materials prices.

 

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U.S. stock futures rise as Fed rate decision looms

LONDON, June 29 (Reuters) - U.S. stock futures gained on Thursday, indicating an opening rise for Wall Street, with all eyes on the Federal Reserve's interest rate decision and statement later in the New York session.

By 0955 GMT, U.S. stock futures were showing gains of around 0.2 percent for the three main indexes <SPc1> <DJc1> <NDc1>, lifted by a 1 percent rise in European shares <.FTEU3> and strength in Japanese stocks.

U.S. stocks rose on Wednesday thanks to gains in the energy sector. The same could be true later with crude continuing to firm above $72 a barrel after weekly inventory data showed crude and gasoline supplies fell more than expected last week.

The Federal Reserve is widely expected to lift its benchmark fed funds rate by a quarter-percentage point to 5.25 percent at 1815 GMT, a 17th rise in two years with more to come.

The wording of the Fed's statement has kept investors uncertain amid lingering concerns that the central bank's monetary tightening will slow economic growth and hurt corporate profits.

"We think the rise we are going get this evening will be the top of the cycle and that the Fed is about to pause. As or when the Fed indicates it is at the peak of a cycle we think the equity market will go up," said Jim Wood Smith at Christows Stockbroker.

Shares of Walt Disney Co. (DIS.N: Quote, Profile, Research) will be in focus after ticking up after hours on Wednesday after saying it has chosen former Procter & Gamble ( PG.N: Quote, Profile, Research) Chairman and Chief Executive John Pepper to serve as nonexecutive chairman.

Shares in memory chip maker Micron Technology (MU.N: Quote, Profile, Research) and Red Hat Inc. (RHAT.O: Quote, Profile, Research) look set to fall after slipping after hours following quarterly results.

Firms due to report earnings later include CA Inc (CA.N: Quote, Profile, Research), Constellation Brands Inc (STZ.N: Quote, Profile, Research), General Mills (GIS.N: Quote, Profile, Research) and Monsanto Co (MON.N: Quote, Profile, Research)

 

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FTSE 100 at 3-week high as oils and miners jump

LONDON, June 29 (Reuters) - Britain's FTSE 100 share index hit a 3-week high on Thursday, fired up by strong resources and bank stocks, although trading levels were modest ahead of a U.S. interest rate decision.

Banks saw HSBC (HSBA.L: Quote, Profile, Research) and Royal Bank of Scotland (RBS.L: Quote, Profile, Research) gain 1.1 percent, while Barclays (BARC.L: Quote, Profile, Research) put on 1.5 percent. Traders said an easing of concerns that the Federal Reserve would hike U.S. interest rates by 50 basis points instead of 25 basis points as previously expected helped the banks. Higher interest rates raise the prospect of bad debts and crimp consumer borrowing.

Online gaming company PartyGaming (PRTY.L: Quote, Profile, Research) was a major gainer, up 3.1 percent, after a report that it is set to unveil plans to expand into sports betting through acquisitions. The Guardian newspaper said the move would be funded with a bond issue worth up to 500 million pounds.

Oil majors BP (BP.L: Quote, Profile, Research) and Royal Dutch Shell (RDSa.L: Quote, Profile, Research) gained around 1.3 percent each as crude prices climbed further above $72 after falls in U.S. crude and gasoline inventories, raising concerns about fuel supplies.

By 1002 GMT the FTSE 100 was up 67.5 points or 1.2 percent at 5,746.1, its highest since June 6 and well above mid-June's the 6-month lows of 5,467.4 scored on concerns that interest rates would have to spike to contain inflation.

"We are responding now dramatically to the vagaries of hype, to base metals and oil prices, that's all the market is about," said David Buik, a market commentator at spread betters Cantor Index.

He added that markets were slowing down as investors waited for the Fed decision and ahead of the quarter and half-year end. Many investors were also distracted by UK summer sporting events such as Wimbledon.

"I don't like the low level of volume. It means the market is wholly uncertain, people have got a "talk to me in September" approach, which is thoroughly unhealthy and I wouldn't be surprised to see volatility on good and bad news," he said.  

 

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MICROLINK

KUALA LUMPUR, June 23 (Bernama) -- Microlink Solutions Bhd, listed on the Mesdaq Market of Bursa Malaysia Friday, is confident of achieving the revenue and net profit it forecast for its financial year 2006.

The company had announced a targeted net revenue of RM23.3 million and net profit of RM6.45 million when launching its prospectus earlier this month.

"Currently, our order book has already achieved 60 percent of the forecast revenue for this year. We are therefore confident of meeting our forecast figures," Microlink's chief executive officer Edward Phong told reporters after a ceremony to mark the company's listing here today.

Microlink is an investment holding company which provides information technology (IT) solutions to the global financial services industry.

The company developed the Microlink Banking Solution (MiBS), an end-to-end solution designed to automate core processing functions such as deposits and investments, loans and financing, treasury and trade finance for both conventional and Islamic banking.

According to Phong, Microlink is also focusing on Islamic banking, currently the hottest growth sector in the industry.

He said the company aimed to provide an innovative core of Islamic banking services built on open source technology to ensure optimum usability by the global financial services industry.

In its financial year ended Dec 31, 2005, Microlink recorded RM19.82 million in revenue with the Islamic banking market in the Middle East and North Africa contributing 10 percent.

"This market (the Middle East and North Africa) contributed 15 percent of our revenue in the first quarter of 2006," Phong said.

He said the company has set up a support centre in Kuwait to provide services to customers in the region, covering Saudi Arabia and the other Gulf countries as well as North Africa.

Microlink, he added, has also set up a representative office in Jakarta to expand its Southeast Asian operations.

Phong said new Islamic banks coming up in Malaysia will provide a potential market for the company.

He said the company currently has RHB Bank Bhd, EON Bank Bhd and Bank Muamalat Bhd among its major clients.

Microlink's stock traded at 58 sen with a volume of 5,990 lots during the market opening this morning, which was higher nine sen compared to its issue price at 49 sen.

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Bursa Malaysia least affected by worries about US interest rates

01:19PM (28-06-2006)

Lower liners and penny stocks shed some gains in active trade in the morning session on June 28, but the decline was relatively milder compared with Asian markets worried about higher US interest rates.

Rimbunan Sawit Bhd, which made its debut on the Main Board, rose 10 sen to RM1.10. It was among the actively traded counters with 8.88 million shares done.

At 12.30am, the Kuala Lumpur Composite Index was down 2.26 points to 905.5 and the Second Board Index shed 0.6 of a point to 92.51. The FBM Emas Index fell 15.22 points to 5,908.78.

Turnover shrunk nearly 17% to 187 million shares valued at RM240 million. There were 361 losers, 141 gainers while 262 counters were unchanged.

Major Asian markets fell. Japan's Nikkei 225 fell 1.54% or 223.37 points to 14,938.44, South Korea's KOSPI 1.2% to 1,232.51, Hong Kong's Hang Seng Index fell 0.47% to 15,700.17 and Singapore's Straits Times Index 0.58% to 2,343,99.

Light crude oil for August delivery was at US$72 (RM265.62). The ringgit was quoted at RM3.682 to the US dollar.

Analysts said worries about hikes in US interest rates were overplayed but nevertheless, it did cause concern in Asian markets. Higher interest rates could affecte corporate earnings.

Among the heavyweights, Maybank fell 10 sen to RM10.50 while Tenaga and Telekom were unchanged at RM9.15 and RM8.95.

Kosmo loan stocks fell 25 sen to RM6.80 but with only 100 shares done. Bursa, Transmile and DiGi fell 10 sen each to RM5.60, RM12.80 and RM10.30 respectively.

MAS, which was reported to receive as much as RM850 million in compensation from the government for giving up bulk of its domestic routes, fell two sen to RM2.68.

Avenue Capital Resources, which was re-listed as ECM Libra Avenue after the merger, fell 19.5 sen to 80.5 sen. The reference price set by Bursa was RM1.

Actively-traded Konsortium Logistik, which is looking at the region to expand its automobile logistics services, rose 5.5 sen to 73.5 sen. Satang Jaya added four sen to RM2.05.

Iris was the most active with 15.36 million shares done. It fell one sen to RM1.15.

Genting was the top gainer, up 20 sen to RM23.60, Fiamma added 13 sen to 94.5 sen while SP Setia gained eight sen to RM3.74. Pos Malaysia rose two sen to RM4.32.

YTL Power rose four sen to RM1.94 after Merrill Lynch initiated a buy on the stock with a 12-month target price of RM2.30.

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MARKET iN TOUCH - 3 APR 2006

MARKTE iN TOUCH

9th Malaysia Plan had been announced. Economy ahead is expected to be better. In mid run, better economy prospect boosts our capital market. CI may start to pick up again from 926.63 (31 Mar 2006) base. For this week, CI may gradually increase towards 935 points. Construction counter may pick up again after retracement completed in near term.

 

STOC iN TOUCH

Selective Mesdaq Counters may still be punters and traders' favorite. IRIS, GHLSYS, DATASCN and INGENS.

AFTER 9TH MALAYSIAN PLAN ANNOUNCEMENT, HOW WILL OUR CAPITAL MAREKT REACT?

Our Capital Market may probably be boosted with the good economy forecast and budget spending on econonomy development. It lifts our economy, some corporates may even benefit from the plan.

For short term effect, market may have digested all the good news prior to the annoucement. On the other hand, market may react positively towards the middle term as the projects start to contribute to our economy development.

 

Day Trader Favorites - 26 Mar 2006

This Week Day Traders' Favorites :

 

IRIS, MEMS, MKLAND, SALCON, FAJAR, AMTEL

AKNMTECH (0017)

Minor Correction was done with a day, lowest at RM0.435. 8 Feb today broke out and closed at RM0.525, denotes uptrend may continue with stronger momentum.

AKNMTECH (0017)

AKNMTECH 1st Target Hit on 6 February 2006

Short Period Trend : To undergo minor correction

 

 

MARKET iN TOUCH - 15 JAN 2006

Ci is now lingering at either heading upward to 920 or downside to 907. From the trend it is expected to move upward in coming week. 920 is the nearest resistance to break for 940 target. No matter CI is heading up or tracing back, selective 2nd and 3rd liners may continue performing. During this CNY rally, 2nd and 3rd liners may have better capital gain than blue chips.

As previous forecasted, market is expected to having upside in Jan-Feb 2006. Some did ask us whether it is the start of Super Bull Run. Our analysis shows that it is too early to conclude this statement. On the other hand, if the buying sentiment is persistently increased, no doubt it may induce big players to inject or increase their investment portfolio. Some Economists have started to forecast positive economic projection data for year 2006.

 

For more, please log on to http://STOCTOUCH.tells.it

MARKET iN TOUCH - 08 JAN 2006

CI at 4 Jan upturn 4.28, 5 Jan hike 9.53 and 6 Jan up 5.01. 911.67 denotes the return of buying sentiment may drive market to higher points during this CNY Rally. But it has to encounter minor retracement in next few trading days in order to go further. Upside with no retracement is normally not long lasting. The support for the minor retracement is 905-908 points. The next resistances faced are 920 and 940 points before it can break 950.

 

Please visit our homepage at http://STOCTOUCH.tells.it for more.....

MARKET iN TOUCH - 26 Dec 2005

Market is forecasted to be good in Jan-Feb 2006, many good 2nd & 3rd liners may have chances to rebound from its history low hit in year 2005. For short period, CI resistance at 900 and support at 890. Though market may not have huge upside for the last week of Year 2005, but some counters may have good advancement to close at higher price level as a result of window dresssing effect.

 

Please visit our homepage at http://STOCTOUCH.tells.it for more.....

MARKET IN TOUCH - 20 DEC 2005

MARKET IN TOUCH - CI is likely to further continue its upside for next few trading days. It has a good opportunity towards 900 points for short period.

STOCK IN TOUCH - MTDINFRA-W has completed its consolidation, it is expected to rebound in next few trading days. On the other hand, watch out OSKVI, the upside may be intterupted anytime from now.

MARKET IN TOUCH - 11 DEC 2005

CI may further rebound in this week, as the negative sentiment had been digested. But it may have no aggresive upside at the moment.