The Securities Commission was asked to explain whether it has found any market manipulation in the Kuala Lumpur Stock Exchange when its composite index (KLCI) rebounded strongly in the last few minutes of trading on Wednesday.

DAP chairman Lim Kit Siang said that the stockmarket watchdog should clarify whether it has conducted a probe on possible market manipulation after the KLCI fell to a 23-month low of 638.5 points earlier on March 21 before recovering strongly to close at 673.24.

He added the eleventh-hour surge in the index was due to massive institutional buying on three major 'TMT' stocks - Telekom Malaysia Bhd, Malayan Banking Bhd and Tenaga National Berhad.

"It has been conservatively estimated that RM19 million worth of purchases took place in the last three minutes on Wednesday for the Big Three 'TMT' stocks," said Lim in a statement today

"The three 'TMT' stocks are government-controlled and represent about 35 percent of the weightage of KLCI giving a considerable leverage to the government to manipulate the composite index."

According to Lim, the last 30 seconds before the KLCI closed at 5pm on Wednesday, the index soared 13.18 points.

Test of transparency

The share price of Tenaga gained 80 sen from RM11.90 to RM12.70 in the final three minutes of trading, while Maybank gained 40 sen from RM12.60 to RM13.00. Shares of Telekom gained 50 sen from RM11.50 to RM12.00 two minutes before the market closed.

"Under normal circumstances, ordinary remisiers or political-unconnected brokers would be hauled up by the Securities Commission for questioning for any irregular market price, as for instance, if a counter at RM5 suddenly ended trading at RM5.50," said Lim.

Lim said that the action of the Securities Commission on this issue will be a test of its transparency, integrity and good corporate governance.