Bursa to test the 1,600 level this week

THE benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) will eye the 1,600 level this week, surpassing the all-time high of 1,597 recorded in July last year.

Head of Retail Research, Affin Investment Bank, Dr Nazri Khan said the better global sentiment and an improved eurozone credit market, will provide an upside momentum to share prices on Bursa Malaysia.

He said despite the rising oil prices and a dovish, “no-stimulus” statement by US Federal Reserve chairman Ben Bernanke, global equities including the FBM KLCI are likely to price in a more upside momentum on improved sentiment, the European Central Bank’s huge liquidity injection, strong US jobs data, positive China manufacturing data and better credit market in the eurozone.

“The improvement in the broader market sentiment can be seen from the global risky assets performance which has gained momentum while safe-haven assets continue to wind down,” he told Bernama.

Nazri said the biggest near-term catalyst will be the European Central Bank’s 530bil liquidity boost, which is the first round of the bigger one trillion euros financial bazooka to avert a credit crunch, dubbed as a long-term refinancing operation (LTRO).

Last Friday, the local bourse rallied amid the broader, stronger market momentum in regional equities.

On a Friday-to-friday basis, the FBM KLCI earned 25.01 points to 1,583.78 from 1,558.77 previous Friday.

The Finance Index increased 268.24 points to 14,129.75 from 13,861.51 previously. The Plantation Index increased 47.22 points to 8,678.21 from 8,630.99. The Industrial Index advanced 61.07 points to 2,926.77 from 2,865.70 last Friday. The FBM Emas increased 153.79 points to 10,946.89 from 10,793.10 previously.

Weekly volume decreased to 8.560 billion shares worth Rm9.87bil from 9.635 billion shares worth Rm9.345bil previously. Turnover on the main market decreased to 5.601 billion shares valued at Rm9.394bil from 6.055 billion units valued at Rm8.741bil previously. – Bernama