KUALA LUMPUR (Sept 4): The FBM KLCI today pared earlier losses to close higher — albeit just below the 1,600 psychological level — buoyed by July trade data as exports returned to positive territory.

At 5pm, the benchmark index closed 8.37 points or 0.53% up to 1,599.89, led by Petronas Dagangan Bhd, which rose 4.48% to RM22.38, and Petronas Gas Bhd, up 2.45% at RM15.92.

All sub-indices, save for the barometers tracking Malaysian REITs and utilities, ended higher. The small-cap index rose 109.06 points or 0.85% to finish at 12,896.83 points.

Market breadth was positive with more gainers than losers — 479 versus 308 — while total turnover stood at 2.49 billion shares worth RM1.73 billion.

Bursa Malaysia's most actively traded stocks included Priceworth International Bhd, which signed a memorandum of understanding with Innoprise Corp Bhd for the supply of logs. The proposal will also see Innoprise, which is the investment holding vehicle of Yayasan Sabah, taking up a 30% stake in Priceworth.

Reuters reported that Malaysian stocks inched higher, boosted by the finance index after exports rose unexpectedly in July, rebounding from a drop in the previous month owing to solid demand for manufactured goods and higher shipments to China.

Malaysian exports increased 1.7% to RM88 billion in July from a year earlier, on higher sales of electrical and electronic goods, liquefied natural gas, refined petroleum products, natural rubber, and timber-based items, data provided by the Malaysian Statistics Department showed.

Various research houses today cut their respective KLCI year-end targets in view of the lacklustre corporate earnings in the just-concluded second quarter.

"We are cutting our end-2019 FBM KLCI target to 1,680 points (pts) based on 17x our revised 2020F earnings projection at a discount to its 5-year historical average of about 18x. This compares with 1,820pts based on 18x our previous 2020F earnings projection.

"We now hold the view that the FBM KLCI is unlikely to trade in line with its historical average, at least over the immediate term, as we believe the risk-off trade will prevail over the rest of 2019. Investors are likely to continue to lighten their positions in high-risk asset classes, i.e. equities and emerging market (EM) assets, while seeking refuge in safe-haven asset classes, i.e. developed market (DM) bonds and even zero-yielding precious metals," said AmInvestment Bank research analyst Joshua Ng.

Regional bourses closed mostly higher with Japan's Nikkei up 0.12% and South Korea's Kospi finishing with a 1.16% gain.

Hong Kong's Hang Seng Index jumped 3.9% after the media reported that the government would formally withdraw the proposed extradition bill that had sparked three months of protests in the former British colony.

In China, the Shanghai Stock Exchange Composite Index rose 0.93% on upbeat service sector data.