KLCI surges to 2-1/2 month high on foreign buying

02 Apr 2013

KUALA LUMPUR: Foreign buying of index-linked stocks especially banks and Tenaga Nasional on Tuesday evening pushed the FBM KLCI to close at a 2-1/2 month high and outperforming the key regional markets.

At 5pm, the KLCI was up 17.39 points or 1.04% to 1,685.00, this highest since Jan 15. Turnover was one billion shares valued at RM1.97bil. The broader market displayed the broader positive sentiment with two stocks advancing for every one decliner, with 522 gainers, 224 losers and 278 stocks unchanged.

Analysts said market sentiment was also given a boost after Nomura Equity Research upgraded Malaysia banks to "overweight". The report cited their underperformance compared to other banks in the Southeast Asian region and a likely removal of political overhang post the upcoming elections.

Reuters reported European shares extended gains on Tuesday when new data showed the region's factory activity no worse than originally estimated in March, while the euro slipped as investors worried about the impact of the Cyprus bailout.

The euro zone Manufacturing Purchasing Manager's Index (PMI), which points to future levels of factory activity, fell in March to 46.8 but was slightly better than a preliminary estimate of 46.6.

Among the key regional markets, Japan's Nikkei 225 fell 1.08% to 12,003.43; Shanghai's Composite Index shed 0.30% to 2,227.74 and South Korea's Kospi lost 0.49% to 1,986.15.

Singapore's Straits Times Index inched up 0.3% to 3,317.59; Hong Kong's Hang Seng Index rose 0.31% to 22,367.82 and Taiwan's Taiex gained 0.18% to 7,913.18. At Bursa Malaysia, blue chips rallied on strong fund buying of index-linked stocks which also saw the spillover of interest to second liners.

Power giant Tenaga jumped 37 sen to RM7.59, adding 4.71 points to the KLCI. Maybank which added 11 sen to RM9.41 and gave the KLCI a 1.7 point boost while Genting Bhd rose 20 sen to RM10.10 and added 1.59 points. PetDag gained 46 sen to RM23.28, and PetGas climbed 20 sen to RM19.

Crude palm oil for third-month futures rose RM50 to RM2,337 on some bargain hunting after falling for four straight days to the lowest since Dec 20 on Monday.

KL Kepong climbed 18 sen to RM21.18, IOI Corp gained six sen to RM4.70 and FGV added eight sen to RM4.70.

Among consumer stocks, BAT surged RM3 to RM63.70 and it was the top gainer while Nestle added 52 sen to RM61.

Banking stocks also saw a run-up in their prices, with CIMB gaining seven sen to RM7.65, Public Bank 12 sen to RM16.42 and RHB Capital11 sen to RM8.61.

On a broader market, interest was seen also for the second liners, withAirAsia up seven sen to RM2.84. UOA Development rose 26 sen to RM2.28.

The ringgit strengthened against the US dollar to 3.0873 from 3.0932.

US light crude oil fell seven cents to US$97 but Brent added 22 cents to US$111.30.

Spot gold shed 80 cents to US$1,598.72.

Sources: The Star