PETALING JAYA: The flood of liquidity in Bursa Malaysia pushed the trading volume above the 12 billion-mark for the first time in history, with the technology sector alone dominating about 42% of the shares traded.
The retail investor-driven liquidity seems to have shifted interest from glove and healthcare-related stocks that was largely the case since the bull rally started in mid-March, to technology stocks.
“The fact that glove stocks have become too expensive for retail investors may have caused the shift. For example, Top Glove Corp Bhd and Hartalega Holdings Bhd are now trading above RM24 and RM17 a share unit, respectively, not many retail investors would afford to buy at that level.
“Besides, the growth story for tech stocks looks tempting with the increased interest in the 5G theme play, ” a trader told StarBiz.
Penny tech stocks overwhelmed the bourse’s top 10 most active counters list yesterday, topped by the 4.5 sen Lambo Group Bhd with a trading volume of 1.2 billion.
Underpinned by the growing appetite for technology stocks, the valuation of Bursa Malaysia’s technology sector is hovering at the highest level in about six years.
For context, the price-to-earnings ratio of the Technology Index surged to 41.89 times yesterday, as compared to its year-to-date lowest of only 19.84 times on March 19.
Second to the technology sector, the industrial products and services sector recorded the most traded volume, followed by the telecommunications and media sector.
Yesterday, the local bourse’s trading volume touched about 12.5 billion, with a turnover of RM6.64bil.
This indicated strong appetite for small and mid-cap stocks as the average share price was 53.16 sen.
However, in terms of value traded on Bursa Malaysia, glove stocks continued to rule the scene.
Of the RM6.64bil value traded, Supermax Corp Bhd alone accounted for 22%, while Top Glove represented another 16%.
“The Big Four glove stocks (Top Glove, Hartalega, Supermax and Kossan Rubber Bhd) made up 45% of value traded while the remaining listed glove players added another 11% to make it 55%, ” he said.
Top Glove rose to a fresh record high of RM24.82 yesterday, following the glove maker’s proposed two-for-one bonus issue. Similarly, Supermax also hit a new all-time-high of RM18.40 after the company announced plans to reward shareholders with one-for-one bonus shares.
However, despite the strong buying of Top Glove shares that powered the FBM KLCI by 7.66 points, the bourse’s barometer index fell 6.88 points or 0.43% to 1,589.45 points.
Public Bank fell by 64 sen to RM17.64 and erased 3.83 points off FBM KLCI, while Maybank was down 12 sen to RM7.82 and wiped out 2.08 points
TNB dropped 20 sen to RM11.34 and shed 1.76 points off the barometer index.
The broader market was cautious with 592 losers to 506 gainers and 399 counters unchanged.
Across the Asian region, the sentiment was rather mixed.
Reuters reported China stocks rose 3%, led by financial firms, after regulators moved to bolster the market by lifting equity investment cap for insurers and encouraging mergers and acquisitions among brokerages and mutual fund houses.
At the close, the Shanghai Composite index was up 3.11%, while the blue-chip CSI300 index ended up 2.98%.
Japan’s Nikkei 225 inched up marginally by 0.09%, Hong Kong’s Hang Seng down 0.12% and South Korea’s Kospi fell 0.14%.
Within South-East Asia, Singapore’s Straits Times Index, Thailand’s SET and Indonesia’s Jakarta Composite Index fell by 0.08%, 0.09% and 0.56%, respectively.
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