taking a cue from Louie, I'd say, you're writing too fast for the lcd to keep pace.

You can try this
Code:
Mainloop:          
                 LCDOUT $FE,1    ' Clear display         
                 LCDOUT $FE,2," This is a test"       ' Move to 1st line, writes 15 CHAR         
                 LCDOUT $FE,$C0,"Next or Select"     ' Move to 2nd line, writes 14 CHAR 
STOP 
End