Asian markets broadly higher

Stock markets in the region began on a stronger footing at the start of the new week. Bellwether indices in key Asian markets closed mostly higher for the day after investors decided that last Friday’s sell off was overdone.

Investor confidence improved after Wall Street closed higher last Friday, which brought its weekly gains to some 3%. The sell off in Asian stocks late last week was triggered by the US Federal Reserve’s unexpected move to raise the discount rate, the rate at which it lends to banks.

But the stronger close for US stocks assuaged concerns that the rate hike would derail the country's economic recovery. In fact, some are hoping that it signals the US government’s confidence in the health of its financial system and strength of the recovery.

Stocks on Bursa Malaysia too traded on a firmer footing, in line with regional gains. The FBM KLCI opened higher and stayed in positive territory throughout the trading day. The benchmark index finished nearly nine points higher at 1,266.4.

Market breadth was also positive. There were more than two gaining stocks for every losing one. Some of the notable gainers for the day include PPB, Supermax, Kossan Rubber Industries, Latexx Partners, Tomypak and Genting PLANTATION []s. At the other end, Parkson was among the more actively traded top losers for the day.

Trading volume, however, was not much changed despite the improved sentiment. Just over 600 million shares changed hands today, slightly lower than the 623 million transacted last Friday. MAS-OR was, by far, the most actively traded counter for the day. Other actives include Frontken-OR, KNM, Malaysian Merchant Marine, Maybank, Axiata and Fast Track Solution.

We expect the local bourse will continue to take cues from the US and regional markets in the coming days.