KL shares likely to extend rally

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KUALA LUMPUR: Bursa Malaysia is likely to extend its pre-Budget 2016 rally on the back of a significantly steady ringgit and dovish US Federal Reserve (Fed) decision on its interest rates.

Affin Hwang Investment Bank vice-president/head of Retail Research Datuk Dr Nazri Khan Adam Khan said the key index was bottom-basing and could regain strength if foreign inflows and buying interest are sustained.

He added that the FBM KLCI could trade with an upward bias to re-test its immediate resistance of 1,750 underpinned by the rebound play in Budget 2016-linked companies.

“The hints about Malaysia’s conclusion of the Trans-Pacific Partnership should also boost Bursa Malaysia’s confidence and shore up the ringgit ahead of Budget 2016,” he told Bernama.

Nazri said the FBM KLCI and global stocks pushed higher and pared last month’s losses after the minutes of the Fed’s September policy meeting played to expectations that US interest rates would not be raised this year.

The FBM KLCI rose above the 1,700-level on Friday, its first break in two months as construction stocks and trading services stocks strongly rebounded.

“This came around after the ringgit soared to its best gain since 1998, surging 5.1 per cent to RM4.11 per US dollar following positive foreign net inflow,” said Nazri.

On a weekly basis, the key benchmark FBM KLCI finished at 1,706.54, up 77.74 points from 1,628.80 last Friday.

The FBM Emas Index increased 483.32 points to 11,734.52, the FBMT100 Index appreciated 472.03 points to 11,439.34, the FBM Emas Shariah soared 520.27 points to 12,471.90 and the FBM 70 advanced 339.71 points to 12,471.90.

Meanwhile, the FBM Ace climbed 263.51 points to 5,810.66.

Sector-wise, the Finance Index advanced 556.20 points to 14,500.61, the Plantation Index added 159.81 points to 7,462.98 while the Industrial Index rose 133.07 points to 3,320.78.

Weekly turnover increased to 11.49 billion units worth RM12.7 billion from  7.88 billion units worth RM9.54 billion last week.

Main market volume rose to 6.83 billion units worth RM11.71 billion from 4.50 billion units worth RM8.70 billion.

Warrant turnover went up to 2.42 billion units worth RM441.29 million from  1.82 billion units valued at RM357.42 million.

ACE market volume expanded to 2.23 billion units worth RM549.79 million from 1.55 billion units worth RM480.61 million last Friday. — Bernama