KUALA LUMPUR – Bursa Malaysia has maintained its uptrend this morning, taking its cue from Wall Street’s rally overnight as investors welcomed another interest rate hike by the United States Federal Reserve (Fed), said an analyst.
Earlier today, the central bank raised its key interest rate by the expected 75 basis points, lifting the rate to the highest level since 2018.
At 9.20am, the FTSE Bursa Malaysia KLCI (FBM KLCI) gained 10.95 points to 1,481.66 from yesterday’s close of 1,470.71.
The benchmark index opened 1.68 points better at 1,472.39.
On the broader market, gainers surpassed losers 347 to 101, while 229 counters were unchanged, 1,621 untraded and 66 others suspended.
Turnover stood at 359.74 million units worth RM157.65 million.
In a research note today, Malacca Securities Sdn Bhd said the positive momentum on Wall Street is likely to spill over to the regional and local bourses.
“The local bourse is expected to trade in a positive tone today following the solid gains on Wall Street.
“We believe the recent rebound should continue as the comments by the US Fed chair Jerome Powell have eased investors’ concerns over the interest rate hike outlook going forward,” it said.
Meanwhile, on commodities, it noted that Brent crude rose to above US$106 (RM472) per barrel, while crude palm oil (CPO) was trading above RM3,850 per barrel.
It said the energy sector might gain traction with the improvement in the CPO price.
The brokerage firm also anticipates the technology sector to get a boost after the Nasdaq booked its biggest daily percentage gain since April 2020, jumping by more than 4% yesterday.
Meanwhile, Bursa heavyweights Maybank gained one sen to RM8.81, Public Bank and Petronas Chemicals added 8 sen each to RM4.68 and RM8.72, respectively, IHH Healthcare was 5 sen higher at RM6.42 and CIMB Group advanced 2 sen to RM5.24.
Of the actives, Bintai Kinden and Techna-X edged up half-a-sen each to 12.5 sen and 4.5 sen, respectively, Dagang NeXchange improved 1 sen to 79.5 sen, Metronic Global rose 2 sen to 15 sen and SFP Tech Holdings went up 5 sen to 72.5 sen.
On the index board, the FBM Emas Index bagged 83.17 points to 10,513.15, the FBM Emas Shariah Index earned 78.20 points to 10,573.11, the FBMT 100 Index garnered 82.28 points to 10,267.61, the FBM ACE widened 55.40 points to 4,834.60, and the FBM 70 surged 126.65 points lower at 12,605.12.
Sector-wise, the Plantation Index strengthened 19.75 points to 6,866.05, the Financial Services Index jumped 136.52 points to 16,692.54, the Industrial Products and Services Index climbed 1.46 points to 180.00, and the Energy Index expanded 9.53 points to 654.73.
Meanwhile, the ringgit strengthened against the US dollar at the opening today as Fed chair Jerome Powell is seen to be less hawkish in his comments following the announcement of the 75 basis points rate hike yesterday.
At 9.24am, the local currency rose to 4.4485/4525 versus the greenback from yesterday’s close of 4.4570/4590.
SPI Asset Management managing partner Stephen Innes said the ringgit should see a bit of a reprieve today as Powell’s press conference was a bit less hawkish than expected.
“But the big question for currency markets is how much further will the Fed move into restrictive territory?
“With the Fed in data-dependent mode, the next hike of 50 bps or 75 bps will depend on how US core inflation comes out,” he said.
Earlier today, Powell said there will be a point where the Fed would start to slow down on its hikes to assess the impact.
Innes noted that the Fed also does not see the US economy as in a recession.
“I think many are betting on weaker US gross domestic product, which is causing a softer US dollar outlook today,” he added.
Meanwhile, the local currency fell against the Singapore dollar to 3.2189/2222 from yesterday’s close of 3.2111/2130 and depreciated versus the Japanese yen to 3.2813/2848 from 3.2614/2631.
It also fell against the euro to 4.5366/5407 from 4.5207/5228 yesterday and declined versus the British pound to 5.4085/4133 from 5.3783/3807. – Bernama, July 28, 2022
