Interest in lower liners

Shares on the Bursa Malaysia traded on a firmer footing on Wednesday, Oct 14. The FBM KLCI opened in positive territory and gained strength as the day progressed.

The stronger sentiment was mirrored in key Asian markets where most of the relevant bellwether indices traded broadly higher. Of the major markets, only Japan’s Nikkei 225 ended with a very small loss for the day.

Investors cheered China’s latest export numbers for the month of September. Exports declined by only 15.2%, the smallest drop for the year to date. The fall was also smaller than market expectations.

This was the latest in a string of recent economic data that supports the view that the world’s economies are on the mend. Investors expect China’s GDP for 3Q2009, slated for release next week, to improve over the 7.9% pace set in 2Q2009.

In other developments, the weak greenback continued to fuel commodity prices. Crude oil futures in electronic trading on the New York Mercantile Exchange rallied above US$75 per barrel, the highest level registered in the year to date.

Meanwhile, gold prices hit a new all-time record high, trading at just a shade below US$1,070 an ounce. Investors are buying gold as a hedge against future inflationary concerns, which are being stoked by the global monetary easing.

The FBM KLCI closed 13 points higher at 1,246.8, a fresh high for the year. Among the top gainers were blue chips like Maybank, CIMB, Public Bank, Bursa Malaysia, Sime Darby and Genting. Having said that, it should be noted that the volume traded on these stocks are on the low side.

Trading activities were focused on lower liner stocks such as KNM, SAAG, Silk Holdings, Talam, Time Engineering, 3A and E&O. Market volume topped 1.26 billion shares. Gaining stocks outnumbered losing ones by more than two to one at the close.