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Renewed Consolidation Called For Malaysia Shares

The Malaysia stock market bounced higher again on Tuesday, one session after it had ended the four-day winning streak in which it had advanced more than 45 points or 2.7 percent. The Kuala Lumpur Composite Index remains just above the 1,675-point plateau although it figures to head south again on Wednesday.

The global forecast for the Asian markets is soft on pessimism over the outlook for interest rates. The European and U.S. markets were down and the Asian bourses are expected to open in similar fashion.

The KLCI finished barely higher on Tuesday following gains from the plantations and a mixed performance from the financial shares.

For the day, the index rose 0.48 points or 0.03 percent to finish at 1,676.61 after trading between 1,672.41 and 1,677.76. Volume was 1.8 billion shares worth 1.8 billion ringgit. There were 405 decliners and 372 gainers.

Among the actives, Genting Malaysia plummeted 2.71 percent, while AMMB Holdings plunged 2.27 percent, Genting tumbled 1.89 percent, Tenaga Nasional soared 1.45 percent, IOI Corporation spiked 1.43 percent, RHB Capital skidded 1.24 percent, CIMB Group collected 1.14 percent, Petronas Chemicals dropped 0.82 percent, Malaysia Airports Holdings climbed 0.71 percent, Sime Darby perked 0.44 percent, Sime Darby Plantations advanced 0.41 percent, Digi.com added 0.40 percent, Top Glove shed 0.40 percent, Maybank sank 0.33 percent, Dialog Group gained 0.31 percent, Axiata Group rose 0.20 percent, Kuala Lumpur Kepong was up 0.08 percent and Public Bank, Petronas Gas and Petronas Dagangan were unchanged.

The lead from Wall Street is negative as stocks opened lower Tuesday and fell further into the red as the session progressed.

The Dow shed 179.32 points or 0.67 percent to 26,548.22, while the NASDAQ lost 120.98 points or 1.51 percent to 7,884.72 and the S&P 500 fell 27.97 points or 0.95 percent to 2,917.38.

The weakness on Wall Street partly reflected a negative reaction to a Conference Board report showing a sharp drop in U.S. consumer confidence in June. Also, the Commerce Department reported a steep decline in new home sales in the U.S. in May.

Additional selling pressure followed comments from Federal Reserve Chairman Jerome Powell, who reiterated the Fed will "act as appropriate" to sustain the economic expansion but did not signal the imminent interest rate cut currently being priced in by the markets.

Crude oil futures ended little changed on Tuesday, as traders weighed demand prospects and global crude supply position. West Texas Intermediate crude oil futures for August ended down $0.07 or less than 0.1 percent at $57.83 a barrel.

Closer to home, Malaysia will provide May numbers for consumer prices later today; in April, inflation was flat on month and up 0.2 percent on year.

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