KUALA LUMPUR (Bernama): Optimism about the outlook of US interest rates and China’s improving economic prospects are set to drive Bursa Malaysia higher this week.
Chief economist and fund manager of Interpacific Asset Management Bhd Datuk Nazri Khan noted that the barometer index has managed to stay above the 1,450 psychological level despite recent volatility due to worries over the US Federal Reserve’s (Fed) hawkish monetary policy stance.
"The US headline inflation accelerated in August but the market action was positive. Generally, traders expect the Fed to keep the interest rate (unchanged) at its policy meeting next week,” he told Bernama.
The Fed will announce its decision on interest rates on Sept 20 but is due to meet again on Nov 1 and Dec 13.
At home, he said Bursa’s strength can be seen in lower liners. "We now see the next target at 1,480 and it will likely hit the 1,500 level by year-end,” he added.
Rakuten Trade Sdn Bhd equity research vice-president Thong Pak Leng reckons that bargain hunting is likely to persist in oil and gas counters as oil prices have remained above the US$90 per barrel level.
"We expect the benchmark to continue its upswing next week and trend within the range of 1,440 and 1,460,” he said.
For the week just ended, the FBM KLCI traded mixed as regional markets received a boost from China’s move to cut its reserve requirement ratio by 25 basis and its forecast-beating economic prints.
China’s retail sales grew by 4.6 per cent last month compared to a year ago, while industrial production expanded by 4.5 per cent, beating market expectations.
On a Friday-to-Friday basis, the FBM KLCI rose 4.08 points to end the week at 1,459.03 versus 1,454.95 a week earlier.
On the index board, the FBM Emas Index added 44.25 points to 10,771.17, the FBMT 100 Index increased 42.81 points to 10,444.79 and the FBM Emas Shariah Index was 123.80 points higher at 11,011.35.
The FBM ACE Index went up 20.67 points to 5,209.50 and the FBM 70 Index climbed 116.11 points to 14,251.83.
Sector-wise, the Industrial Products and Services Index put on 1.74 points to 174.48, the Energy Index gained 38.39 points to 893.86 and the Plantation Index climbed 173.06 points to 7,037.21.
The Financial Services Index lost 96.45 points to 16,330.23.
Weekly turnover was lower at 15.17 billion units worth RM12.02 billion versus 18.03 billion units worth RM10.77 billion in the preceding week.
The Main Market volume slipped to 10.70 billion shares worth RM10.96 billion against 13.14 billion shares worth RM9.61 billion in the previous week.
Warrant turnover was easier at 1.73 billion units worth RM252.61 million from 1.79 billion units worth RM254.14 million last week.
The ACE Market volume dropped to 2.72 billion shares worth RM645.46 million against 3.06 billion shares worth RM898.15 million previously. - Bernama
