KUALA LUMPUR (March 1): The FBM KLCI was supported by regional rallies today, as stocks rose, driven by China's announcement of monetary easing measures, which bolstered risk sentiment.

As at 5pm today, the benchmark index rose 16.07 points or 0.97% to 1,670.82.

On Feb 29, the People's Bank of China (PBOC)'s website said it had cut financial institution's renminbi reserve requirement ratio by 0.5 percentage point, the amount of cash a bank is required to hold as reserves.

The move is to maintain sufficient liquidity in the country's financial system, said PBOC.

When contacted, Areca Capital Sdn Bhd chief executive officer Danny Wong Teck Meng told theedgemarkets.com that China's move is not a surprise as he believes the communist government is keen on maintaining stability in the country's financial markets.

"Additionally, Wall Street has fallen overnight, while Asian markets rallied today, indicating that international funds are flowing back to emerging markets, as valuations (here) are relatively lower," he said.

Therefore, Wong reckoned that the inflow of foreign funds into Malaysia would persist in the near term.

Across the local bourse, there were 476 gainers versus 405 losers, with 310 counters remaining unchanged.

Total trading volume stood at 1.67 billion — worth some RM1.65 billion — by market close.

The gainers were led by British American Tobacco (M) Bhd; the biggest loser was PIE Industrial Bhd.

AirAsia X Bhd was the most actively traded counter today. It saw some 100.82 million shares changed hands.

In the regional market, Japan's Nikkei rose 0.37% to 16,085.51 points, while Hong Kong's Hang Seng advanced 1.56% to 19,407.46 points. South Korea's Kospi, on the other hand, declined 0.18% to 1,916.66 points.

Reuters reported that Asian shares shrugged off their early doldrums on Tuesday and extended gains, boosted by China's monetary easing and downbeat manufacturing and service surveys that raised hopes of additional stimulus measures.

On the currency front, the ringgit extended its appreciation against the US dollar today to trade at 4.1693, and at 2.9736 against the Singapore dollar.