KUALA LUMPUR (Oct 30): Bursa Malaysia small caps rose 55.9 points or 0.36% while the FBM KLCI fell 1.27 points or 0.08% as investors eyed prospects of a US interest rate hike this December.

A US rate rise does not bode well for Asian assets as investors turn their attention to US-dollar denominated entities.

In Malaysia, the KLCI ended at 1,665.71 points at 5pm, representing a gain of 44.67 points from 1,621.04 points on Sep 30.

Today, the FBM Small Cap Index closed at 15,683.96. The index comprises companies within the top 98% portion of the Bursa Malaysia Main Market but excludes FBMT100 entities.

RHB Research Institute Sdn Bhd head of research Alexander Chia told theedgemarkets.com that markets reacted to the US Federal Reserve's sentiment on the economic recovery there.

"(In Malaysia) October is the first month we saw net foreign buying after five consecutive months of net foreign selling but the market was caught off guard when the Fed commented that the possibility of a December (interest) rate hike remains.

"There was some support in the market today, mainly from bargain-buy activities by cash-rich local non-government-linked institutions," Chia said over telephone.

Across Bursa Malaysia, there were 451 gainers versus 396 decliners. Trading volume was 2.12 billion shares worth RM2.04 billion.

Leading decliner was British American Tobacco (M) Bhd while top gainers included Lay Hong Bhd and Dutch Lady Milk Industries Bhd. RGB International Bhd topped the most-active list.

In the regional share market, Japan's Nikkei 225 gained 0.78% while South Korea's Kospi fell 0.23%. Hong Kong's Hang Seng declined 0.79%.

Reuters reported that Asian shares edged higher on Friday and were on track for their biggest monthly rise since January 2012, as global central banks kept stimulative policies intact and many hinted at further steps to re-energise their economies.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)