KUALA LUMPUR (March 13) : The Malaysian stock market which saw a downward correction on Monday, is likely to find support on Tuesday from a still-liquid market amid positive domestic news flow ahead of the country’s impending general election .
Analysts said the existing uptrend in the FBM KLCI was still intact as the domestic backdrop is still flush with liquidity and foreign funds are still pouring into the local market.
“The FBM KLCI still has more legs” TA Securities Holdings Bhd head of research Kaladher Govindan wrote in a note on Monday.
On Monday, news of China’s economic slowdown dragged Asian stock markets lower. These include updates that the world’s second largest economy’s exports growth coming in at 18.4% in February, way below street estimates of a 31.1% expansion, according to Bloomberg.
A slowdown in China does not bode well for Asian exporting countries where stock indices had reacted negatively to the updates.
Japan’s Nikkei 225 which fell 0.4% to 9,889.86 and Taiwan’s Taiex which was down 1.1% to 7927.55 and Singapore’s Straits Times Index retreated 0.03% to 2962.18. The FBM KLCI of 30 blue chip stocks fell 0.9% or 14.25 points to close at 1,564.75.
Stocks to watch on Tuesday include Kimlun Corp Bhd, PFCE Bhd, SIG Gases Bhd, GAMUDA BHD , MALAYSIAN AIRLINE SYSTEM BHD  (MAS) and AIRASIA BHD .
Kimlun Corporation Bhd has secured two contracts worth RM151.61 million for housing projects in Johor Bahru.
It had accepted a RM114.70 million contract from S P Setia Bhd’s unit Bukit Indah (Johor) Sdn Bhd for the CONSTRUCTION  of service apartments and ancillary buildings.
It also secured a RM36.90 million contract from Keck Seng (Malaysia) Bhd to build 244 houses in Johor Bahru, Johor. The estimated date of completion is September 2013.
Ceramic products maker PFCE is acquiring the entire equity interest in its single largest shareholder PFC Engineering Sdn Bhd for RM300 million under an all share deal which will transform the acquirer into an oil and gas support services provider. PFC Engineering owns 40% of PFCE.
Shares of PFCE last closed at 70 sen on Friday, prior to the suspension of the stock’s trading on Monday. PCFE will resume trading on Tuesday.
SIG Gases Bhd is teaming up with a unit of Iwatani Corporation, Japan to set up a joint venture company to set up facilities in Samalaju Industrial Park, Bintulu, Sarawak.
The JV would pave the way for SIG Gases and Iwatani to be strategic business partners to set up the facilities in Samalaju to produce and supply of liquid products and compressed gases to customers in Sarawak.
RHB Research Institute Sdn Bhd had reduced its fair value for Gamuda shares by 2.8% from RM3.89 to RM3.78. The downward revision factors in potential earnings from the Klang Valley Mass Rapid Transit project into the research firm’s valuation for Gamuda’s construction business, RHB said. Gamuda shares, however, rose three sen to RM3.70.
The Edge weekly, quoting sources, reported that the share swap between the major shareholders of MAS and AirAsia could be unraveled following resistance from the Malaysian Airline System Employees’ Union. MAS shares declined two sen to RM1.36 on Monday while AirAsia fell four sen to RM3.59.