Shrugging off the Chinese Bugbears

The Chinese market went down on news that stamp duties on stock transactions was increased by 0.2% to 0.3%. Shanghai market index went down by 280 points and the China benchmark CSI300 index took a 6.5% fall. Most overseas market has factored this in and so there was little panic. Moreover only Chinese nationals were affected as foreigners cannot buy those shares that went down.

On the local front, Bank Negara kept the interest rate for the ninth time. The GDP report released was also fair. News that the US Federal Reserve may bring down interest rate was also welcomed.

The composite index went up 7.7 points to 1,347. Gentings went up 5 sen to RM7.90; Resorts World closed at its overnight level of RM3.22 and Metronic added 1 sen to 85 sen. RCE also perked up 1 sen to 81 sen. However, BJ Toto moved up 12 sen to RM4.88.

The biggest loser has to be POS Holdings which lost 24 sen because of the forensic accounting done at Transmile. I hope those responsible for cooking the numbers will rot in jail for CBT. Actually with POS and Kuok Brothers in the company, Transmile will be a good buy. At the current price, POS is also an opportune buy!

With the Chinese bug-bears being relegated to the background, shares should go up gradually. Good time for bargain hunters.

Heartsong