KUALA LUMPUR (June 21): Kuala Lumpur Kepong Bhd (KLK), PPB Group Bhd and Genting Plantations Bhd were among the plantation heavyweights that saw a rebound in today's trade after a decline seen in recent trading weeks.
KLK was the top gainer as its share price rose by 24 sen or 1.02% at the noon market break to settle at RM23.78, while PPB was up by 0.94% or 18 sen to RM19.42. Genting Plantations was also higher by 1.49% or 14 sen to RM9.54.
The plantation counters have been on a downtrend recently as crude palm oil (CPO) fell to RM2,257 per metric tonne, its lowest level since July 2017. The recovery was in line with the support level that is seen in the decline of the CPO prices.
Reuters reported that the palm oil may break a resistance at RM2,275 and bounce more to RM2,290 per tonne as support level is seen at RM2,236.
An analyst with a foreign research house said the gain in the plantation heavyweights are on a recovery from their recent slide as well as due to the limited options available as other heavyweights in the telecommunication (telco) sectors and others are impacted by a variety of negative news.
"If you look at the other blue-chip counters like the telcos, they have been impacted by the announcement of the 25% decline in prices for broadband. The construction has its worries surrounding some of the projects that have been cancelled while the exporters are faced with uncertainties surrounding the trade tariffs," he said.
He added that the plantations could have been oversold and with so much negative headlines, some of the local institutions are likely to take position in this space.