[UPDATED] Bursa tracks Wall St performance to open lower

KUALA LUMPUR – Bursa Malaysia opened lower today with the key index falling 0.55%, in line with a weaker Wall Street performance overnight.

At 9.10am, the benchmark FTSE Bursa Malaysia KLCI fell 8.87 points to 1,602.41 from yesterday’s close of 1,611.28.

The index opened 5.13 points easier at 1,606.15. 

On the broader market, losers led gainers 235 to 226, while 313 counters were unchanged, 1,425 untraded and 93 suspended.

Meanwhile, the ringgit opened easier against the United States dollar despite news that Malaysia will be removed from the FTSE Russell Watch List and retain its membership in the FTSE World Government Bond Index (WGBI).

The FTSE Russell announced late yesterday that Malaysia will be removed from the Watch List for potential reclassification of its market accessibility level from “2” to “1”, and will retain its membership in the FTSE WGBI.

At 9am, the local note shed 30 basis points to 4.1420/1470 versus the greenback from 4.1390/1440 at the close yesterday.

In the FTSE Fixed Income Country Classification Announcement for March, FTSE Russell commended Bank Negara Malaysia (BNM) on its previous and ongoing initiatives to address foreign investors’ concerns when accessing the government bond market.

It cited recent market enhancements that include, but are not limited to, improvements to secondary market bond liquidity, and foreign exchange market structure and liquidity.

The secondary market bond liquidity was improved through significantly more reopenings this year of Malaysian government securities (MGS) issuances, and a commitment to switch, as needed, illiquid bonds out and replace them with more liquid bonds.

This, in turn, makes more MGS available via repo, facilitating a marked increase in trading volumes and introducing physical settlement – with the option of a cash settlement – of MGS futures, providing an additional interest rate hedging avenue, while aiming to boost underlying bond liquidity at the same time, said FTSE Russell.

The foreign exchange market structure and liquidity was enhanced through increased price transparency after local trading hours via the now permanent Appointed Overseas Office programme.

The move expands the dynamic hedging programme to include Japanese trust banks and global custodians, and streamlines the forex documentation and due diligence process.

FTSE Russell said it is grateful for the constructive engagement that has taken place with BNM, and the number of positive initiatives introduced over the last two years. 

“FTSE Russell strongly encourages BNM to continue efforts to enhance the experience of international participants in the Malaysian fixed income market.” – Bernama, March 30, 2021