KUALA LUMPUR (June 19): The FBM KLCI opened up today as Asian equities tracked US shares' overnight rise on Tuesday after the US indicated it will restart trade talks with China.
Anticipation of US interest rate cuts also supported world stock market sentiment. Lower US interest rates bode well for Asian markets in anticipation that global fund managers will shift their money into higher-yielding Asian assets such as stocks, bonds and currencies.
At 9am today, the KLCI opened up 1.81 points at 1,654.57. At 9:02am, the KLCI rose 2.36 points to 1,655.12. "The local market should extend range-bound trade with global growth concerns amid the US-China trade standoff and caution ahead of the US central bank policy meeting restricting participation," TA Securities Holdings Bhd wrote in a note today.
Reuters reported that Asian share markets jumped on Wednesday as investors dared to hope the Federal Reserve would follow the lead of the European Central Bank (ECB) and open the door to future rate cuts at its policy meeting later in the day. It was reported that ECB President Mario Draghi's shock turnaround on easing fuelled talk of a worldwide wave of central bank stimulus, firing up stocks, bonds and commodities.
Adding to the cheer was news US President Donald Trump would meet with Chinese President Xi Jinping at the G20 summit later this month, and that trade talks would restart after a recent lull, Reuters reported.
Overnight in US stock markets, it was reported that the Dow Jones Industrial Average jumped 1.35% to end at 26,465.54, S&P 500 gained 0.97% to 2,917.75
while Nasdaq Composite surged 1.39% to 7,953.88.