PETALING JAYA: Bursa Malaysia kicked off the week on a positive note as the government’s special stimulus package for businesses worth RM10bil fuelled fresh optimism in the market.
In addition, momentum also picked up over the prospect of an oil deal among major crude oil producers.
Despite a slight dip in early trade yesterday, potentially due to dampened sentiment following Bank Negara’s weak growth forecast for Malaysia last Friday, the benchmark FBM KLCI later pared its losses ahead of Prime Minister Tan Sri Muhyiddin Yassin’s special address.
By 5pm, the 30-stock FBM KLCI closed 11.04 points, or 0.83%, higher yesterday at 1,341.69 points. Of the 30 constituent stocks, a total of 18 counters gained while nine declined and three remained unchanged.
Following criticisms that the previous two stimulus packages worth RM250bil did not contain enough measures for businesses, Muhyiddin announced an additional package of RM10bil yesterday for small and medium enterprises (SMEs).
The key features of the new package were an additional RM7.9bil wage subsidies and special grants worth RM2.1bil for micro SMEs.
AmBank Group chief economist Anthony Dass called the additional stimulus measures supporting the SMEs as “positive”, given that many businesses were experiencing tight cashflow due to business shutdowns in response to the Covid-19 outbreak.
“With the additional measures plus increasing focus on micro businesses, which make up a big share of the SME establishment, the support will more likely help reduce bankruptcies and bad loans.
“It should also provide some relief to job losses, which remain a major concern, although these are expected to vary considerably according to the age and size of the small businesses, ” he said.
Market breadth across Bursa Malaysia was overwhelmingly positive, possibly due to the optimism arising from the RM10bil stimulus package.
Gainers outnumbered decliners by 738 to 183. Turnover was at 5.99 billion shares valued at RM2.16bil.
The improved market sentiment also seemed to be a result of several news reports which cited US diplomats that negotiations between major oil producers were seeing progress.
The news not only lent a boost to oil price but also sent oil and gas counters higher. This was led by HIBISCUS PETROLEUM BHD, which rose six sen to 51 sen as the most actively traded counter on Bursa Malaysia.
On the other hand, leading banks were seen rising on the RM10bil stimulus measures to mitigate the effects on the SMEs and the economy.
Malayan Banking Bhd rose 25 sen to RM7.65, while Public Bank Bhd gained 20 sen to RM15.90.
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