KUALA LUMPUR (Jan 30): The FBM KLCI rose in early trade on Thursday as investors bargain hunted for battered stocks against domestic pre-election sentiment. This has prompted market anticipation that the benchmark will still be vulnerable to profit taking as the index advances in a still volatile market.
At 9.14am, the KLCI rose 3.12 points or 0.2% to 1,640.46, helped by gains in UMW Holdings Bhd, Hong Leong Bank Bhd, and Hong Leong Financial Group Bhd. These stocks were also among top gainers across the exchange.
A total of 96 stocks rose across the bourse while 54 fell, resulting in 101.9 million shares worth RM67.42 million changing hands.
Top gainer and most active was China Automobile Parts Holdings Ltd which makes its debut on the exchange on Wednesday. The Leading decliner was Xian Leng Holdings Bhd
The FBM KLCI closed almost flat on Tuesday with a 0.21 point gain at 1,637.34. Analysts said the KLCI may continue to see buying interest on Wednesday following the advance a day earlier.
HwangGDBS Vickers Research Sdn Bhd wrote in a note that the "FBM KLCI could be striving to inch its way up today" as the index continues from where it left off yesterday.
"Technically speaking, the benchmark index may attempt to pull away a bit more from the immediate support line of 1,635 ahead.
"Meanwhile, investors on Wall Street are waiting for the U.S. Federal Open Market Committee meeting outcome to be known later tonight. Most likely, the policymakers would leave the federal funds rate at near zero level and reaffirm their accommodative monetary stance for an extended period," HwangDBS said.
Despite the buying interest across Bursa Malaysia, Hong Leong Investment Bank Bhd research head Low Yee Huap warned that the market is expected to "remain jittery" ahead of the country's general election. As such, Low said the KLCI "is susceptible to strong profit taking consolidation" as the index advances.
Across Asia, Japan's Nikkei 225 added 0.98%, South Korea's Kospi fell 0.14% while Australia’s ASX200 was up 0.27%.
Reuters reported that Asian shares inched up on Wednesday, cautiously awaiting local corporate earnings reports and the U.S. Federal Reserve's monetary policy decision due later in the session, while taking comfort from improving global economic prospects.
The MSCI's broadest index of Asia-Pacific shares outside Japan inched up 0.2 percent to build on the previous day's 1 percent rally which snapped a four-day losing streak.
Global stock markets rose on Tuesday as earnings from U.S. companies have generally beaten forecasts so far with the latest upbeat results from Amazon boosting the company's stock up 10 percent.
European equities scaled fresh two-year highs on Tuesday as optimism over economic recovery gained momentum after strong U.S. housing market data raised hopes for accelerating demand, while an upgrade in China's economic growth forecast for 2013 by the country's top think tank bolstered risk appetite.