FBM KLCI higher on blue chip gains

Sentiment in Asian stock markets strengthened on Thursday, April 1. The relevant bellwether indices key markets such as Japan, Hong Kong and Singapore were in positive territory throughout the trading day.

Investors were encouraged by reports that manufacturing activities in China accelerated in March even as business confidence strengthened in Japan, the world’s second largest economy, despite overnight losses on Wall Street. Also, South Korea reported a strong 35.1% year-on-year rise in exports in March, its fifth straight month of double-digit gains.

Shares on the Bursa Malaysia too traded on a firmer footing. Blue chip stocks, in particular, saw renewed buying support. Gains in index heavyweights such as MISC and CIMB as well as blue chips Tanjong plc, Nestle, PPB and DiGi lifted the headline index, the FBM KLCI sharply higher. The benchmark index added nine points to close at 1,329.8 points.

Market breadth, on the other hand, was somewhat more ambivalent. The ratio of gainers to losers slipped in and out of the red throughout the day. At the close, the number of gaining stocks managed to inch ahead of losing ones by roughly four to three.

New listing, Oversea Enterprise was the most heavily traded stock for the day. Shares for the restaurant operator, listed on the ACE market, ended the day at 25 sen, for a premium of 8.7% over its initial public offer price of 23 sen. Other heavily traded counters include Time dotCom, MRCB, UEM Land and Berjaya Corp.

Total trading volume dipped slightly despite the benchmark index’s strong gains. Over 807 million shares changed hands, down from the 961 million shares traded on Wednesday and 1.05 billion shares traded Tuesday.

It is likely that some investors are staying on the sidelines ahead of the long Easter weekend and key employment report in the US, due out Friday. Nevertheless, we suspect sentiment in equities will remain firm in the near term barring any major negative news.