KLCI closes at near 2-month high of 1,470

KUALA LUMPUR: The deal struck by euro zone leaders on Greece's debt burden energized regional markets on Thursday, Oct 27, as fund buying pushed the FBM KLCI towards a near two-month high.

The KLCI closed up 13.13 points or 0.90% to 1,470.93 – the best performance since Sept 2 -- after a strong start in the morning. Trading volume was heavier with 1.88 billion shares changing hands at RM2.313 billion.

The broader market was firm, with gainers leading losers 689 to 165 and 195 counters unchanged.

Commodities also rallied, with US light crude oil surging US$2.18 to US$92.38. Crude palm oil futures for third-month delivery rose RM29 to RM2,980 per tonne. The ringgit was firmer at 3.1092 to the US dollar.

The upbeat mood was also seen in key regional markets. Hong Kong's Hang Seng rallied 3.26% to 19,688.70, Singapore's Straits Index advanced 2.89% to 2,849.90, Japan’s Nikkei 225 2.04% to 8,926.54, South Korea's Kospi 1.46% to 1,922.04 and Shanghai's Composite Index 0.34% at 2,435.61.

Reuters reported the euro and stocks rallied after European leaders struck a deal to provide debt relief for Greece, but analysts warned the plan would fail to halt the euro zone's two-year-old debt crisis unless crucial details were resolved soon.

Governments announced an agreement under which private banks and insurers would accept 50 percent losses on their Greek debt holdings in the latest bid to reduce Athens' massive debt load to sustainable levels. The deal also foresees a recapitalisation of hard-hit European banks and a leveraging of the bloc's rescue fund, the European Financial Stability Facility (EFSF), to give it firepower of 1.0 trillion euros (US$1.4 trillion).

At Bursa Malaysia, the star performers which pushed the KLCI were Genting, IOI Corp, Public Bank, Gamuda and Petronas Chemicals (PetChem).

Genting rose 31 sen to RM10.30, giving the 30-stock index a 2.65 point push while Public Bank gains 14 sen to RM12.62 and Gamuda 20 sen to RM3.37, adding a combined 2.8 points.

IOI Corp rose 16 sen to RM5.26, adding 2.38 points to the index, after it cancelled the RM830 million land purchase deal with Dutaland. Dutaland fell seven sen to 54 sen and the warrants three sen to 10 sen.

Tenaga rose five sen to RM5.83, HLBank 22 sen to RM10.58, Gamuda 20 sen to RM3.37 and PetChem 12 sen to RM6.31.

Supermax added 30 sen to RM3.56. CIMB Investment Bank Bhd said that the less volatile natural rubber latex prices will lead to earnings re-rating for Supermax as a result of better margins and higher demand. The stable costs would enable the group to pass on a higher portion of its costs on to customers, regaining lost profits when raw material costs increased.

Among actively traded counters were Hibiscus, up two sen to 69.5 sen while Hibiscus-WA rose three sen to 32 sen. The securities resumed trading on Thursday after announcing the deal to acquire a 35% stake in Lime Petroleum Ltd for US$55 million.