KUALA LUMPUR (Sept 5): The FBM KLCI opened down today before rising as Asian equities rose amid an apparent easing in Brexit and Hong Kong's political concerns.
At 9am, the KLCI opened down 0.37 point at 1,599.52 before rising 2.42 points at 9:02am to 1,602.31. The KLCI extended gains so far today after closing up 8.37 points or 0.53% at 1,599.89 yesterday.
Today, Hong Leong Investment Bank Bhd wrote in a note : "Although yesterday’s bounce would help offset concerns about the decelerating global economy, which deepened after a slew of weak PMI readings and the resumption of the latest round of US and China tariffs last week, the risk-on mood may be premature as sentiment remains buffeted by external and domestic issues coupled with the final decision by FTSE Russell on local government bonds ratings on the World Government Bond Index soon."
"Nevertheless, we still anticipate positive news flows ahead of the Budget 2020 (11 Oct), further rates cut by Fed/ BNM to cushion slowing economy, trade diversion and M&A activities to provide a lift to our lull market," Hong Leong said.
Across Bursa Malaysia today, 177.22 million shares worth RM73.64 million were traded at 9:12am. Top gainers included Pintaras Jaya Bhd and Tenaga Nasional Bhd.
Globally, Reuters reported that Asian stocks perked up on Thursday, as apparent progress in the political crises in Britain and Hong Kong gave investor confidence a shot in the arm, with easing fears of a hard Brexit lifting the battered pound. It was reported that sterling held onto gains against the dollar in Asia after rallying by its most in more than five months on Wednesday as lawmakers voted to prevent Prime Minister Boris Johnson taking Britain out of the European Union without a deal on Oct 31.
According to Reuters, risk appetite also rose on news that Hong Kong leader Carrie Lam was withdrawing an extradition bill that had triggered months of often violent protests in the Asian financial hub. It was reported that MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.24%. U.S. Treasury yields extended gains in Asia and the yield curve steepened, both signs that investors were willing to take on riskier assets, according to Reuters.