FBM KLCI rebounds on local fund buying support

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KUALA LUMPUR (May 17): The FBM KLCI closed 6.17 points or 0.39% higher today at 1,605.36 on buying support from local funds and after Bank Negara Malaysia (BNM) announced on Thursday its market liquidity and accessibility enhancement initiatives.

Today, analysts said the KLCI had also risen on account of US shares' Thursday overnight rise. Today, TA Securities Holdings Bhd senior technical analyst Steven Soo said the KLCI's rise is due to the overnight recovery in US shares and also an oversold Malaysian stock market.

“Furthermore BNM came out with measures to boost liquidity, so all of these factors combined were seen boosting the domestic market,” Soo said.

The KLCI rebounded today to close up at 1,605.36 after falling 12.24 points On Thursday.

Today, the KLCI jumped to its intraday high at 1,610.96 before paring gains at the 5pm market close. The KLCI pared gains after Asian stock indices ended lower as China-US trade war concerns continued to hit sentiment.

In China, the Shanghai Stock Exchange Composite closed 2.48% lower while Hong Kong's Hang Seng fell 1.16%. Elsewhere across Asia, South Korea's Kospi dropped 0.58%.

Reuters reported today that Asian shares suffered a fresh bout of the shakes on Friday as tough words on trade from China's media drowned out upbeat news on the US economy and corporate earnings. It was reported that Shanghai stocks led the way into the red amid the growing fallout from President Donald Trump's move to block China's Huawei Technologies from buying vital American technology.

According to Reuters, the sense of foreboding grew as the Communist Party's People's Daily used a front page commentary to evoke the patriotic spirit of past wars, saying the trade war would never bring China down.

Overnight in the US, it was reported that shares at Wall Street closed higher on Thursday as upbeat earnings and strong economic data put investors in a buying mood, with technology companies leading the charge. It was reported that the Dow Jones Industrial Average rose 214.66 points, or 0.84%, to 25,862.68, the S&P 500 gained 25.36 points, or 0.89%, to 2,876.32 and the Nasdaq Composite added 75.9 points, or 0.97%, to 7,898.05.

Malaysia will see a holiday-shortened trading session next week in conjunction with the Wesak Day and Nuzul Al'Quran holidays, which fall on Monday (May 20) and Wednesday (May 22) respectively, according to Bursa Malaysia Bhd's website.

Bursa Malaysia said in a statement that the group will be closed on Monday, in lieu of Wesak Day, which falls on Sunday (May 19). "Bursa Malaysia and its subsidiaries will resume operations on Tuesday, 21 May 2019," the bourse operator and regulator said.