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Losses May Accelerate For Malaysia Market

The Malaysia stock market gave up less than a point on Thursday - but that was enough to snap the four-day winning streak in which it had risen more than 15 points or 1 percent. The Kuala Lumpur Composite Index remained just above the 1,630-point plateau, and now investors are bracing for continued consolidation when the market kicks off trade on Friday.

The global forecast for the Asian markets is lower, thanks to weaker than expected GDP results in the Eurozone - especially those in Germany and France. Also, professional forecasters surveyed by the European Central Bank have lowered their view on growth and inflation outlook for the euro area. The European markets were down and the U.S. bourses were mixed but little changed and the Asian markets also are tipped to open lower.

The KLCI finished flat on Thursday as losses from the financial shares and industrial issues were offset by support from the plantation stocks.

For the day, the index eased 0.27 points or 0.02 percent to finish at 1,630.89 after trading between 1,630.37 and 1,635.55. Volume was 679.07 million shares worth 1.43 billion ringgit. There were 319 gainers and 268 decliners, with 287 stocks finishing unchanged.

Among the actives, CIMB Group Holdings dropped 1.24 percent, Maxis shed 0.47 percent, Sime Darby sipped 0.11 percent and British American Tobacco fell 0.34 percent, while Hong Leong Financial climbed 1.34 percent, IOI Corporation added 0.41 percent, AirAsia jumped 0.75 percent and YTL Power spiked 1.30 percent.

The lead from Wall Street continues to provide little clarity as stocks turned in another lackluster performance on Thursday after recovering from an early move to the downside. The major averages eventually closed mixed for the third consecutive session.

The early weakness followed reports showing contractions in fourth quarter GDP in Germany, France, and Japan - leading to renewed concerns about the global economy. German GDP fell 0.6 percent in Q4, while French GDP dropped by 0.3 percent. Both decreases were slightly steeper than expected.

A separate report showed that Japanese GDP edged down 0.1 percent in the fourth quarter compared to estimates for 0.1 percent growth.

Reflecting the potential impact of weakness overseas, auto giant General Motors (GM) cited losses in Europe as a reason for weaker than expected fourth quarter earnings.

But an upbeat jobs report from the U.S. helped to offset the negative sentiment, with the Labor Department reporting that initial jobless claims fell to 341,000 in the week ended February 9, down 27,000 from the previous week's revised 368,000. Economists had expected claims to edge down to 360,000 from the 366,000 originally reported for last week.

News on the merger-and-acquisition front also helped to limit the downside, with shares of Heinz (HNZ) moving sharply higher after the food product company agreed to be acquired by an investment consortium comprised of Berkshire Hathaway and 3G Capital.

The major U.S. averages were mixed but little changed on Thursday as the Dow eased 9.52 points or 0.1 percent to finish at 13,973.39, while the NASDAQ crept up 1.78 points or 0.1 percent to close at 3,198.66 and the S&P 500 inched up 1.05 points or 0.1 percent to end at 1,521.38.

by RTT Staff Writer

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