Bursa Malaysia ends above 1,600 level

KUALA LUMPUR: Bursa Malaysia se led above the 1,600 level Wednesday, boosted by oil and gas counters – Petronas Chemical, Petronas Dagangan as well as Axiata.

At 5pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 6.45 points to close at its intraday high of 1,602.30.

The market barometer opened 2.03 points be er at 1,597.88.

Phillip Capital Management senior vice-president (investment) Datuk Nazri Khan Adam Khan said despite volatility surrounding Axiata-Telenor mega-merger failure, FBM KLCI managed to open higher.

He said oil and gas-related counters staged a strong performance in tandem with the strength shown in global oil prices.

However, foreign investors he said, are shi ing away from Malaysia’s financial market following discouraging gross international reserve data, which shrank by 0.4 per cent to US$103.5 billion as of Aug 30, 2019.

“Overall, we expect the FBM KLCI to flirt around 1,600 level with the recent telco merger clouding sentiment and oil and gas service providers should shine as global oil prices are on hopes for Organisation of the Petroleum Exporting Countries (OPEC) production cuts.

“As the prospects of OPEC and major oil producers are strengthening their alliance to reduce oil price volatility amid waning energy demand, aggressive investors might consider capitalising on it,” he said.

Furthermore, the government are also seeking fiscal space to prioritise sustainable economic growth by not introducing new tax measures in the upcoming 2020 Budget.

According to the MOF, such expansionary measures will help raise the confidence of the corporate sector and investment community.

Hence, Nazri said Bank Negara Malaysia may embark on another rate cut with the overnight policy rate (OPR) se ling at 2.75 per cent amid so er economic growth and the ongoing easing cycle from major central banks around the globe.

Bank Islam Malaysia Bhd’s chief economist Dr Mohd Afzanizam Abdul Rashid said there also seem a positive development from China with regards to the scrapping of investment quota limits on equities – Qualified Foreign Institutional Investors (QFII) and the Renminbi Qualified Foreign Institutional Investor (RQFII).

“Additionally, the Chinese government has announced the exemption of certain products imported from the US.

“Such development would pave the way for bilateral discussion scheduled next month, which could lessen the friction.