The KL Composite Index staged a convincing upward trend to cross the 970 level, highest in six months. The broader market was firmer, with lower liners and penny stocks rising in active trade.

The Prime Minister’s move to remove the 30% equity requirement for bumiputras in 27 services sub-sectors had galvanised sentiment. Investors are expecting more liberalisation measures for the financial services sector, which could underpin sentiment.

The firm close on Wall Street could also reinforce the investors’ sentiment when the market kicks off on April 27.

Meanwhile, Group of Seven (G7) finance ministers and central bankers said in Washington on April 25 the global economy may be past the worst phase of a recession although recovery was not yet assured, and they pledged to make sure that big financial firms are sound.

The finance ministers expected economic activity should begin to recover later this year. However, they said the outlook remained weak and there was a risk that the global economy may still worsen.

As for the local stock exchange, fund managers said sentiment was running ahead of fundamentals and they were more comfortable with the KLCI trading at 12 times price-to-earnings from the more than 13 times now.

“Maybe, it should be time for investors to lock in gains counters which had run up a lot,” said a fund manager, adding that bulk of the corporate results would be out in May while economic fundamentals have yet to show any improvement.

Stocks which would see trading interest are Ramunia, KNM, Telekom Malaysia and Maybank

The Edge weekly reported over the weekend that government-linked companies including Sime Darby could be keen on Ramunia.

KNM would also see heavy churning of its stocks which had been very actively traded in recent days, but investors have yet to see any fresh corporate news.

Telekom Malaysia’s war chest had increased significantly after it received RM2.09 billion from Axiata Group. The amount was the remainder of the RM4 billion owed to TM. The initial RM2 billion was paid ahead of schedule earlier this month.

The payment from Axiata was in line with the terms of the demerger agreement dated on Dec 10, 2007.

Maybank’s rights shares could be deemed a success after these rights shares of 2.19 billion rights shares received 98.93% acceptance. The 98.93% acceptances accounted for 2.17 billion rights shares. There were also excess applications for 632.28 million rights shares or 28.79%.

These rights shares are scheduled to list by April 30. Maybank’s share base will be enlarged by 45% to 7.08 billion shares from its nine-for-20 issue.

Plantations should attract interest on the back of firm crude palm oil prices, with KL Kepong and IOI Corp among the favourites.