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By YVONNE TAN PETALING JAYA:

The local stock market was on rally mode again yesterday, reversing morning session losses to finish near an eight-month high. 
At the close, the KL Composite Index (KLCI) closed up 15.09 points or 1.50% to 1,023.96, its highest close since Sept 25 last year. 
Market turnover stood at 2.5 billion shares, the highest since April 2007 in trade worth RM2.16bil.
"Technically, we have entered a bull run," Jupiter Securities head of research Pong Teng Siew said. "The overall rally seems strong and conditions such as improved domestic liquidity, appear conducive for it to carry through for some time." 
The key index has advanced more than 20% from its recent bottom of 836.51 on March 12. "We still have a lot of catching up to do compared with regional peers,"

Kenanga head of research Yeonzon Yeow said. Analysts said yesterday's rally saw strong participation from retail investors and local funds, supported by foreign buying. Investors in Asia appeared to have shrugged off concerns about the results of the stress tests on 19 US banks as most markets in the region advanced. 
Singapore's Straits Times Index advanced as much as 5.04%, driven by better-than-expected earnings of United Overseas Bank Ltd and Overseas-Chinese Banking Corp."Malaysian retail investors jumped right back in yesterday afternoon after believing that the results of the stress tests may not be too much of a concern here," Pong said. Unofficial reports on the stress tests yesterday indicated that Bank of America would need about US$34bil in extra capital. Analysts expect the test results, to be made public today, to show that all 19 banks are solvent, but with 10 or 11 of them needing more capital to weather a possible worsening of the US recession. 

On the outlook ahead, Pong said: "The market will pause but it is difficult to say when."However, Kenanga's Yeow expects profit-taking to set in by the end of the week. "But each low will be higher than the last, so that's good, profit taking is healthy and allows investors trading opportunities," he said. 

Among the gainers yesterday, Malayan Banking Bhd rallied 34 sen to RM4.92, Bumiputra-Commerce Holding Bhd added 25 sen to RM8.70 while chip maker Unisem Bhd jumped 30 sen to RM1.20. In the currency market, the ringgit closed lower against the US dollar.

At 5pm, the ringgit was traded at 3.5310/5360 compared to Tuesday's close of 3.5080/5130. Crude palm oil three-month futures finished up RM55 to RM2,680 per tonne

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