Market Close KLCI higher on ECB easing hopes

by **Cals** Fri 11 Mar 2016, 01:31

Market Close

[size=28]KLCI higher on ECB easing hopes

By Billy Toh / theedgemarkets.com | March 10, 2016 : 6:00 PM MYT

KUALA LUMPUR (March 10): The FBM KLCI climbed 4.56 points or 0.3% with Asian share markets, in anticipation that the European Central Bank (ECB) may announce more stimulus measures to support the region's economy.

At 5pm, the KLCI closed at 1,690.91. Across Asia, Japan’s Nikkei 225 was 1.26% higher, while South Korea’s Kospi rose 0.84%.

"A sense of unease scatters across the financial markets, ahead of the heavily-anticipated ECB press conference on Thursday, in which the ECB is broadly expected to unleash further stimulus measures to jumpstart the Eurozone economy," FXTM research analyst Lukman Otunuga wrote in a note today.

"The expectation of another -0.1% slash in deposit rates to -0.4% remains elevated, with speculations mounting over whether the central bank will expand its bond buying program, in a bid to devalue the Euro further," Lukman said.

Reuters reported Asian stocks edged up on Thursday, encouraged by a rally in crude oil prices and expectations that the ECB will ease policy later in the day, emulating policymakers elsewhere seeking to bolster their struggling economies

In Malaysia, Inter-Pacific Research Sdn Bhd research head Pong Teng Siew said the KLCI's advance would hinge on foreign institutional buying.

According to Pong, foreign funds may take the cue from Bank Negara Malaysia's statutory reserve requirement (SRR) cut to 3.5%, from 4% since Feb 1 this year.

An SRR cut would increase liquidity in the market. As such, Pong noted that most Bursa Malaysia blue chips were doing well, due to foreign fund buying.

“In the near-term, it (KLCI) will generally continue to be on an uptrend. One of the biggest contributing factor is the return of foreign funds,” he said.

Across Bursa Malaysia today, there were 441 gainers versus 355 decliners. A total of 1.72 billion shares, worth RM1.81 billion, exchanged hands.

Top gainer was Kossan Rubber Industries Bhd, while leading decliner was British American Tobacco (M) Bhd. The most active stocks included AirAsia X Bhd and Bumi Armada Bhd.
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