KUALA LUMPUR (Nov 26): The FBM KLCI closed up 14.53 points or 0.91% at its intraday high of 1,612.11 today after news reports indicated that Parliament had approved the Malaysian government's proposed Budget 2021 and as local equities took a cue from the global stock market rise.
MIDF Amanah Investment Bank Bhd research head Imran Yassin Yusof told theedgemarkets.com today the biggest driver for the KLCI’s rise is the Parliament’s approval for Budget 2021.
Across Bursa Malaysia today, sentiment was positive with 816 gainers versus 412 decliners. A total of 8.87 billion securities were traded for RM4.68 billion as global stocks took cue from encouraging news on Covid-19 vaccine trials and updates on the US Government transition to President-elect Joe Biden’s administration.
It was reported today that Asian shares advanced on Thursday as market euphoria over Covid-19 vaccines and expectations that a Biden administration would deliver more economic stimulus and political predictability overrode a slate of weak US economic data. It was reported that the rally started after Biden's US election victory earlier this month raised hopes for more government spending to support the pandemic-hit economy and for more policy predictability after four years of Donald Trump's presidency.
"Reduced policy uncertainties are helping markets. It will be easier for companies to make capital expenditures,” Reuters quoted Arihiro Nagata, general manager of global investment at Sumitomo Mitsui Bank as saying.
It was reported that Prime Minister Tan Sri Muhyiddin Yassin won Parliamentary approval for his government's 2021 Budget on Thursday, avoiding a potential political crisis in the midst of other crises brought on by the coronavirus pandemic.
It was reported that Parliament passed the Budget by a voice vote, leaving it unclear exactly how many of the 222 lawmakers supported the Government's first Budget since Muhyiddin emerged as the leader of a new coalition in March.
“He (Muhyiddin) would likely get a political respite, as the Opposition would likely not be able to muster a majority to topple him in the short term," Oh Ei Sun, a senior fellow with Singapore’s Institute of International Affairs, was quoted as saying by Reuters.
At a glance, the Parliamentary approval for Budget 2021 could have mitigated expectations of political uncertainty in Malaysia, hence the broad-based buying across Bursa today at a time when the nation is still contending with the economic impact of the Covid-19 pandemic.
Out of the 29 Bursa indices, 26 closed higher today while three gauges, namely, the Energy, Financial Services and REIT gauges ended lower.
Among Bursa-listed stocks, top gainers included technology companies and rubber glove manufacturers.
The list included semiconductor manufacturer Malaysian Pacific Industries Bhd (MPI) besides glove manufacturers Supermax Corp Bhd, Top Glove Corp Bhd and Hartalega Holdings Bhd
MPI topped the gainers list today after its share price closed up RM1.88 or 7.97% at RM25.48. The stock pared gains at 5pm after rising to its record high at RM26 earlier today.
MPI’s share price rise had partly contributed to Bursa’s Technology index’s 3.02% rise when markets closed. The index was the top percentage gainer among Bursa indices today.