PETALING JAYA: The Bursa Malaysia rebound extended for a second day as the White House struck a deal with the Congress for the US$2 trillion coronavirus (Covid-19) aid package to bail out the US economy.
The FBM KLCI jumped 33.36 points or 2.58% in a roller coaster of a day to close at 1,324.50 points.
The benchmark stock index of Bursa Malaysia rode on the spectacular rally on Wall Street by opening at 1,322.19 points yesterday after testing the 1,300-point mark for merely two hours on Tuesday.
The Dow Jones Industrial Average saw a historical surge the night before with an 11.37% jump, the highest percentage gain since 1933 while the S&P 500 climbed 9.38% on the back of expectations that Donald Trump was close to reaching an agreement with the Senate Republicans and Democrats over the stimulus package.
This boosted the sentiments of key Asian markets yesterday including Bursa Malaysia, which saw them extending their gains.
Then came an announcement during lunch where Prime Minister Tan Sri Muhyiddin Yassin declared the extension of the movement control order (MCO) for a further two weeks until April 14.
Selling ensued right after the midday break, which saw the FBM KLCI tumbling to 1,304.97 points, only to see a sharp rebound 10 minutes later as news emerged that the US reached an agreement on its US$2 trillion virus rescue bill.
CGS-CIMB head of Malaysia research Ivy Ng said there would be more downside to market earnings this year with the MCO extension due to the extended closure of businesses.
She added that the sectors that may be least affected from the MCO for now are the telecommunication and utilities industries.
RHB Research Institute head of research Alexander Chia said the market understood the need for the MCO as the alternative would be much worse.
“We expect to see continued volatility as investors’ short-term horizons means the market will be reactive to news flow, ” he said, adding that sectors directly impacted, such as gaming, aviation, F&B and hospitality will suffer deeper.
Meanwhile, Rakuten Trade Sdn Bhd vice-president of research Vincent Lau said positive sentiments in the market also surround the more comprehensive economic stimulus package that Muhyiddin will announce on Monday.
Out of the 30 component stocks on FBM KLCI, 26 counters recorded increase in share prices, two declined and two remain unchanged.
Kuala Lumpur Kepong Bhd led the index as the top gainer with a 10.48% jump in its share price to RM20.66 with 386,800 units traded.
The top laggard in the benchmark index was RHB Bank Bhd, which declined 2% to RM4.90, making it the only banking counter on Bursa Malaysia to record a reduction yesterday.
The other decliner on the FBM KLCI was MISC BHD, which dropped 0.66% to RM7.55.
Overall, market breadth was still positive with 640 advancers and 267 decliners while 356 remain unchanged.
The trading volume yesterday stood at 4.33 billion shares worth RM2.83bil.
Oil and gas related counters dominated the top three most actively traded, led by HIBISCUS PETROLEUM BHD which saw a 6.45% jump to 33 sen with 140.72 million shares exchanging hands.
BUMI ARMADA BHD rose 8% to 13.5 sen with a volume of 121.08 million while Velesto Energy Bhd climbed 4.76% to 11 sen with 118.36 million shares traded.
Low-cost carrier AIRASIA Group Bhd also seemed to draw renewed interest as its share price jumped 17.46% to 74 sen 102.65 million shares traded.
Its sister company AirAsia X Bhd, was up 20% to 6 sen with a volume of 25.07 million shares.
In the region, the Jakarta Composite Index was again the only decliner among key Asian markets as it slid 1.3%.
Japan’s Nikkei 225 rose 8.04% followed by Singapore’s STI at 6.07%.
South Korea’s Kospi was up 5.89% while Taiwan’s Taiex and Hong Kong’s Hang Seng Index rose 3.87% and 3.81% respectively.
Did you find this article insightful?