FBM KLCI ends at intraday high ahead of Powell's speech

FBM KLCI ends at intraday high ahead of Powell's speech
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KUALA LUMPUR (Aug 23): The FBM KLCI closed up 6.86 points or 0.43% after an 11th-hour spike as global stock markets rose ahead of US Federal Reserve chair Jerome Powell's speech, which will offer clues on whether the Fed will further cut interest rates.

It was reported that Powell is scheduled to speak at 1400 GMT on Friday (Aug 23) during a gathering of central bankers in Jackson Hole, Wyoming.

At Bursa Malaysia, the KLCI settled at its intraday high at 1,609.33 at 5pm on bargain hunting after falling to its intraday low at 1,594.59.

“KLCI managed to recover all its intraday losses to close at its highest level in 12 weeks. This was boosted by gains across the board due to bargain hunting activities,” Malacca Securities Sdn Bhd senior analyst Kenneth Leong told theedgemarkets.com.

The KLCI's 11th-hour spike followed the resumption of the index's price feed at Bursa Malaysia since 4:25pm today after nearly an one-hour long interruption. Earlier, the bourse operator and regulator had issued separate special announcements on the KLCI's indicative values since 3:35pm.

Globally, Reuters reported that world stock markets and the dollar rose on Friday as investors looked to a speech by Powell for clarification on whether the US central bank remains on course to deliver another interest rate cut next month.

Suggesting markets remain broadly confident of further Fed easing, European stocks rebounded from the previous day's falls, with the pan-European STOXX 600 index gaining as much as half a percent in early deals while Britain's FTSE 100 index was up 0.64%, according to Reuters. It was reported that the MSCI's All Country World Index, which tracks shares across 47 countries, was up 0.1% and set to break a three-week losing streak.

In Malaysia, Leong told theedgemarkets.com that the sustainability of the KLCI's buying momentum will very much depend on the Fed's interest rate decision.

“If the US Fed cuts the interest rate, we might see a further recovery on the global (equity) market. Otherwise, the market will trade sideways,” Leong said.

Across Bursa Malaysia today, trading volume stood at 2.01 billion shares worth RM1.74 billion. Top-active stocks included AirAsia X Bhd, which saw some 30 million shares traded.

AirAsia X's share price closed down one sen or 5.13% at 18.5 sen today after the budget airline reported yesterday that its second quarter net loss widened to RM207.11 million from a net loss of RM57.46 million a year earlier.