FBM KLCI bucks regional trend to close above 1,500, shored up by Hartalega’s best-ever earnings

FBM KLCI bucks regional trend to close above 1,500, shored up by Hartalega’s best-ever earnings
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KUALA LUMPUR (Oct 27): The FBM KLCI ended the trading day above the 1,500 level, boosted by healthcare stocks after Hartalega Holdings Bhd posted another record set of quarterly results.

At 5pm, the benchmark index closed 5.74 points or 0.38% higher at 1,500.35, supported by 616 gainers against 379 losers.

The FBM KLCI was the exception among other regional indices that fell, in line with Wall Street’s sharp overnight drop — the biggest decline in a month — amid soaring Covid-19 cases and slow progress on a US stimulus deal.

Japan’s Nikkei 225 dipped 0.04% while South Korea’s Kospi dropped 0.56%. China shares also declined with the Hang Seng falling 0.53%. Meanwhile, the Shanghai Composite Index rose 0.1%.

Inter-Pacific Securities Sdn Bhd head of research Victor Wan noted that there was a mild rally on the market today, likely due to Hartalega.

The glove maker today announced that it recorded its best-ever quarterly net profit at RM544.96 million in the second quarter ended Sept 30, 2020 (2QFY21), about five times the RM103.87 million posted last year.

“Overall market breadth was also positive because of less political pressure due to the recent truce with Umno [after the supreme council made a decision to continue to support the Perikatan Nasional government]. But still, there [are] a lot of uncertainty hence the market remains cautious in the medium term and might take the opportunity to sell,” Wan told theedgemarkets.com when contacted.

He also noted that today’s market volume, which recorded about 4.71 billion transactions worth RM4.11 billion, was quite thin compared with previous sessions, reflecting the market’s cautiousness towards the stock market for the time being.

Hong Leong IB Research in a note today said the benchmark index is likely to be stuck in a tug-of-war between the bulls and bears ahead of the US presidential election (Nov 3) and the Budget 2021 presentation (Nov 6), coupled with an exponential surge of coronavirus cases worldwide as the winter season begins in the northern hemisphere.

“Stocks-wise, we believe technology and healthcare-related stocks are deemed to benefit from a prolonged virus pandemic,” it said.

Lam Jian Wyn