Sime Darby yesterday added some RM3 billion to its market capitalisation of more than RM56 billion by closing 51 sen higher at RM9.46 per share.
THE stock market breached the 1,500-point barrier again, for a record close, as Malaysia's oldest conglomerate Sime Darby Bhd came to life to close at its highest level in 36 months.
Trading at levels unseen since May 2008, Sime Darby, which is also the world's biggest palm oil planter by acreage, added some RM3 billion to its market capitalisation of more than RM56 billion by closing 51 sen higher at RM9.46 per share.
Sime, which controls some 8.69 per cent weightage of the 30 stock strong FTSE Bursa Malaysia KLCI (FBM KLCI), and other plantation companies such as Kuala Lumpur Kepong Bhd and Chin Teck Plantations Bhd helped push the market to a record close, for the second consecutive day.
The market closed 18.47 points higher at the 1,551.89-point pinnacle, while the relative strength of the index, which measures if stocks are either overbought or oversold, stood at 71.
A reading of 75 or above indicates that stocks are overbought. However, in extreme bullish conditions, triggering the overbought signal does not lead to a market meltdown.
The bullish market also helped the ringgit to trade at RM3.0635 to the US dollar, its strongest level since late 1997.
Lee Cheng Hooi, the head of research at Maybank Investment Bank Bhd, who is also one of the country's prominent technical analysts, said that the immediate upward resistance for the benchmark index is 1,553 points, followed by 1,618 points.
"These are for a three-month time line," Lee told Business Times, adding that the downside for the market in the near term is minimal.
"It should contain at the 1,500-point level. I am cautiously optimistic," said Lee.
He said the market has been very tigerish over the first two trading days because funds, domestic and external, had received fresh investment mandates from their principals.