KUALA LUMPUR (March 29): The FBM KLCI rose 12.63 points or 0.7% as the ringgit strengthened with the yuan, after China allowed its currency to trade firmer against the US dollar.

At 5pm, the KLCI finished at 1,715.04 points. The ringgit strengthened to 3.9945 against the US dollar.

Reuters reported China's yuan was firmer against the dollar at midday on Tuesday, after the central bank fixed a stronger midpoint in response to the greenback's slip, as soft U.S. data dampened expectations for an April Federal Reserve interest rate hike.

Prior to market opening, the People's Bank of China set the midpoint rate at 6.506 per dollar, 0.26% stronger than the previous fix of 6.5232.
 
In Malaysia, TA Securities Holdings Bhd senior technical analyst Stephen Soo told theedgemarkets.com that the market’s performance today was mainly due to the currency play.

“Besides the stronger performance from the ringgit, there is also the spillover effect from the bond market, which had some foreign demand, into the equities market.

“However, this positive effect might not hold on for the rest of the week, as there will be the expected quarter-end profit taking activities,” Soo said.

The KLCI rose amid cautious sentiment, ahead of the US Federal Reserve Chair Janet Yellen's speech at 1620 GMT today. Yellen's speech will be closely watched for clues on the US' interest rate policy.

US rate hikes do not bode well for Asian markets, as investors shift funds back to US dollar-denominated assets.
 
Asian markets ended mixed. Hong Kong's Hang Seng rose 0.1%, while Japan's Nikkei 225 was down 0.18%.

In Malaysia, Bursa Malaysia saw 1.65 billion shares, valued at RM2.16 billion traded. There were 417 gainers against 376 decliners.

Top gainer was PIE Industrial Bhd. Petronas Dagangan Bhd and Panasonic Manufacturing Malaysia Bhd were among top decliners.

The most active stocks included AirAsia Bhd and newly-listed Bison Consolidated Bhd.

PIE was closely watched. SJ Securities senior remisier Goh Kay Chong told theedgemarkets.com that PIE shares rose "on institutional buying".

Goh said there was a group of institutional investors who have been buying PIE shares since early this month.