websphere queue connection factory - Test connection - not working set up issues

Question

I tried setting up a websphere queue connection factory however get the following error:

A connection could not be made to WebSphere MQ for the following reason: CC=2;RC=2009

Any ideas? This is what I did:

1. Installed websphere 7.0 base version
2. Installed update installer
3. installed fix pack 27 (7.0.0.27)
4. installed websphere MQ Explorer and able to browse the remote queue
5. Configure the queue connection factories >> resources >> JMS >> Queue connection factories >> cell scope >> new >> websphere MQ Queue messaging provider >> Name : test >> Jndi Name: jndi/test >> Description : Test queue connection factory >> Enter all the required information to wizard >> Queue Manager NAme : SMSD1 >> Transport : Client >> Hostname : SMSMQD1 >> port : 1414 >> Server connection Channel : SMS1.SVRCONN >> Test connection : A connection could not be made to WebSphere MQ for the following reason: CC=2;RC=2009