KUALA LUMPUR (Oct 14): The FBM KLCI closed 10.75 points or 0.69% higher at 1,567.59 points on Monday, buoyed by positive sentiments brought on by the newly-announced Budget 2020 and progress of trade talks between the US and China.
Trading was in the positive territory all day and hit an intra-day high of 1,568.96 points. Nevertheless, the benchmark index remains below the 1,600 psychological level.
Market breadth was positive, with more gainers than losers at 487 versus 367 as trading wraps up for the day, with a total turnover of 2.99 billion shares worth RM1.84 billion.
Malacca Securities Sdn Bhd senior analyst Kenneth Leong told theedgemarkets.com that besides tracking regional markets, gains in the KLCI today were underpinned by the more rosy Budget 2020 announcement last Friday that saw a higher allocation in development expenditure at RM56 billion, versus RM54.7 billion under Budget 2019.
"Market sentiment was also upbeat on the positive progress from the US and China's trade negotiations as both parties are ready to outline phase 1 of their trade deal. As it is, all 13 major sectors finished in the green today.
"Moving forward, the FBM KLCI might see some quick profit taking after three consecutive days of gains before recovering towards the 1,580 resistance level. On the downside, the support is located at the 1,550 level," said Leong.
Elsewhere in the region, the Shanghai Stock Exchange Composite Index closed with a 1.15% gain.
Meanwhile, South Korea's Kospi finished 1.11% higher, while Hong Kong's Hang Seng Index rose 0.81%.
Reuters said Asian stocks firmed on Monday on the back of signs of progress in the Sino-US trade-off, although analysts reminded that the threat to global growth is in fact weak corporate capital expenditure, which may not restart merely from the latest round of agreement between the two countries.
Sentiment was boosted when US President Donald Trump outlined the first phase of a deal to end a trade war with China and suspended a tariff hike, though officials on both sides said much more work needed to be done.
The emerging deal, covering agriculture, currency and some aspects of intellectual property protections, would represent the biggest step by the two countries in 15 months, it added.
Source: The Edge
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