KUALA LUMPUR – The ringgit opened slightly higher against the US dollar today amid firmer global oil prices, an analyst said.
At the time of writing, the benchmark crude oil price gained 0.72% to US$115.05 (RM505.41) per barrel.
At 9am, the local note stood at 4.3925/3960 versus the greenback from Friday’s close of 4.3980/3995.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the firmer oil prices could be the underpinning factor for the ringgit amid uncertainty in the global market.
“The possible relaxation in Covid-19 measures beginning June 1, 2022 for Shanghai have resulted in higher crude oil prices,” he said.
Afzanizam said data from China suggested that its zero Covid-19 strategy was taking a toll on its economy.
He added that China’s economic activity slumped as its retail sales and industrial production index contracted by 11.1% and 2.9%, respectively, during the month of April.
Similarly, the US New York Empire State Manufacturing Index was also down to -11.6 in May 2022 from 24.6 in April 2022, signalling that recovery in the manufacturing sector is still tentative.
Hence, Afzanizam said, such dynamics would mean demand for the safe-haven currency will continue to remain sturdy as economic uncertainty heightens.
However, the ringgit was traded mostly lower against a basket of major currencies.
It depreciated against the Singapore dollar to 3.1573/1601 from Friday’s close of 3.1482/1497, decreased vis-a-vis the euro to 4.5880/5916 from 4.5625/5640, and slid versus the British pound to 5.4151/4194 from 5.3568/3586.
However, the local note strengthened versus the Japanese yen to 3.3982/4012 from 3.4127/4142 previously.
Bursa Malaysia opened higher today on buying interest following the positive gross domestic product in the first quarter of 2022 (Q1 2022), despite mixed sentiment on Wall Street last Friday.
At 9.06am, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) rose 8.93 points to 1,553.34 from Friday’s close of 1,544.41.
The index opened 11.27 points higher at 1,555.68.
On the broader market, gainers led losers 191 to 145, while 257 counters were unchanged, 1,662 untraded and 10 others suspended.
Total turnover stood at 302.04 million shares worth RM128.47 million.
Malacca Securities Sdn Bhd expects bargain-hunting activities to emerge within the recovery-themed and plantation sectors ahead of the reporting season.
“We reckon the economic improvement should spur further buying interest in the recovery-themed sectors such as consumers and banking.
“Meanwhile, the higher crude oil price, which was trading above US$110 per barrel, may boost the energy sector,” it said in a research note today.
Malaysia’s economy grew by 5% in Q1 2022, supported by increases in both domestic and external demand, as well as labour market recovery.
The research firm also expects traders to look forward to plantation earnings this month, which could boost the share price over the near term.
Among the heavyweights, Maybank eased six sen to RM8.90, Public Bank, and CIMB were two sen higher at RM4.55 and RM5.06, respectively, while Petronas Chemicals bagged 39 sen to RM10.38 and IHH Healthcare added one sen to RM6.45.
Of the actives, Sapura Energy increased 1.5 sen to six sen, Serba Dinamik rose two sen to 14 sen, KNM gained half-a-sen to 18 sen, Hibiscus Petroleum was six sen higher at RM1.41, while CSH Alliance was flat at 11.5 sen.
Nestle stood as the top gainers, expanding RM2 to RM133.50, followed by KL Kepong, improving 78 sen to RM27.36, Harrison Holdings adding 31 sen to RM5.98, Hengyuan Refining increasing 29 sen to RM7.27, and Petron Malaysia strengthening 24 sen to RM6.26.
On the index board, FBM ACE fell 13.28 points to 5,329.35, FBM Emas Index advanced 56.57 points to 11,067.37, FBMT 100 Index firmed 54.39 points to 10,741.65, FBM Emas Shariah Index widened 95.70 points to 11,564.11, and FBM 70 added 36.02 points to 13,092.63.
Sector-wise, the Financial Services Index contracted 34.50 points to 16,499.87, the Industrial Products and Services Index was 3.02 points higher at 199.81, and the Plantation Index climbed 98.05 points to 8,277.33. – Bernama, May 17, 2022
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