KUALA LUMPUR: The FBM KLCI closed higher on Wednesday as improving market sentiment, supported by reports of a potential record oil stock release by the International Energy Agency (IEA), lifted investors’ risk appetite.
The benchmark index settled 7.1 points, or 0.42%, higher at 1,708.78, after touching an intraday high of 1,709.93, with banking stocks helping to lift the market.
There were 605 gainers, 447 losers and 525 counters traded unchanged on Bursa Malaysia. Turnover stood at 2.71 billion shares valued at RM2.8bil.
Reports that the IEA is considering the biggest-ever release of strategic oil reserves helped ease concerns over supply disruptions amid the U.S.-Israel war involving Iran. The potential move reassured investors that authorities could cushion the energy shock, sending oil prices slightly lower while currency and bond markets remained largely steady.
Stephen Innes, managing partner at SPI Asset Management, said Asian equities and global futures steadied as crude prices held just below the psychologically important US$90 per barrel level.
He said the US$90 mark has become a key pressure point for markets this week, as prices below that level tend to support risk sentiment, while a break above it could quickly tighten financial conditions.
Innes added that sentiment was also supported by a Wall Street Journal report that the IEA is discussing what could be the largest coordinated release of emergency oil reserves on record.
According to Innes, the prospect of intervention helped push crude prices slightly lower and provided temporary relief to equity markets, although such measures also highlight how tight the underlying energy market remains.
Among the gainers on Bursa Malaysia, Carlsberg rose 48 sen to RM17.46, while PETRONAS Dagangan added 40 sen to RM21.90. United Plantations gained 38 sen to RM31.64 and Chin Teck Plantations
climbed 26 sen to RM10.80.
In contrast, Nestle slid RM1.10 to RM102.90, while Malaysian Pacific Industries fell 56 sen to RM29.98. QL Resources lost 13 sen to RM3.89 and Pentamaster declined 12 sen to RM3.08.
In terms of fund flows, foreign funds and retail investors were net sellers on Tuesday, offloading equities worth RM101mil and RM5mil respectively. Local institutions were net buyers, with total purchases amounting to RM105mil.
Meanwhile, the ringgit strengthened 0.23% against the US dollar to 3.9150 and inched up 0.33% against the Singapore dollar to 3.0732.
On the external front, MSCI’s Asia ex-Japan stock index rose 1.07%, with most regional bourses ending higher.
Japan’s Nikkei 225 advanced 1.43% to 55,025.37, while South Korea’s Kospi gained 1.4% to close at 5,609.95.
Singapore’s Straits Times Index slipped 0.14% to 4,853.67, while Hong Kong’s Hang Seng eased 0.24% to 25,898.76.
Meanwhile, China’s CSI300 rose 0.64% to 4,704.50, while the Shanghai Composite edged up 0.25% to 4,133.43.
