The Malaysia stock market has closed higher now in two of three sessions since the end of the four-day losing streak in which it had given away than 50 points or 3.8 percent. The Kuala Lumpur Composite Index finished just below the 1,540-point plateau, and now analysts are forecasting further upside at the opening of trade on Tuesday.
The global forecast for the Asian markets is cautiously optimistic after many of the regional bourses were brutally oversold last week - although the bargain hunting may be limited by persistent concerns from Europe. Spain may see another economic contraction in the second quarter of this year, Economy Minister Luis De Guindos reportedly said on Monday. The minister also denied that Spain needs any kind of external aid for its banking sector. The European and U.S. markets were higher on Monday and the Asian markets are expected to open in similar fashion.
The KLCI finished modestly higher on Monday as gains from the plantation stocks were dented by selling pressure from the financial shares.
For the day, the index collected 6.45 points or 0.42 percent to finish at 1,538.91 after trading between 1,540.29 and 1,531.95. Volume was 780.03 million shares worth 1078.77 million ringgit. There were 385 gainers and 306 decliners.
Among the actives, Sime Darby, Tenaga Nasional, Axiata, YTL Power and YTL all finished higher, while Maybank, British American Tobacco, Hong Leong Bank and Kuala Lumpur Kepong all moved lower.
The lead from Wall Street is upbeat as stocks saw significant strength on Monday, regaining some ground after falling to a four-month low on Friday. The markets benefited from bargain hunting but remain sharply lower for the month of May. The Dow ended a six-session losing streak, although it still marked just its second gain in fourteen sessions.
Trading activity was subdued, as lingering concerns about Europe and a lack of major U.S. economic data kept some traders on the sidelines. While reports on home sales, durable goods orders, and consumer sentiment will be in focus later this week along with earnings news from Hewlett-Packard (HPQ), Dell (DELL), and Best Buy (BBY), trading activity may remain light.
Among individual stocks, American Eagle Outfitters (AEO) posted a strong gain after the apparel retailer announced plans to exit its children's business 77kids. Shares of Yahoo (YHOO) also ended the day higher after the online media giant announced that it is selling up to half of its stake in Alibaba back to the Chinese e-commerce company for about $7.1 billion.
Meanwhile, Lowe's (LOW) posted a steep loss after the home improvement retailer reported better than expected first quarter results but lowered its full year earnings guidance. Shares of Facebook (FB) also came under pressure, with the social media giant tumbling by 11 percent following its glitch-plagued debut on Friday.
The major averages saw further upside going into the close, ending the session just off their highs. The Dow rose 135.10 points or 1.1 percent to finish at 12,504.48, while the NASDAQ jumped 68.42 points or 2.5 percent to end at 2,847.21 and the S&P 500 climbed 20.77 points or 1.6 percent to 1,315.99.
On the economic front, Malaysia's leading economic index, which monitors economic performance in advance, dropped to 112.8 in March from 113.4 in February, the Department of Statistics said on Monday. In January, the reading was 111.4. On an annual basis, the leading index increased 2.1 percent in March, slower than the 2.9 percent growth in February, the agency said.
The coincident index, which measures the current situation, advanced to 118.8 in March from 117.7 in the previous month, while lagging index moved up to 128.7 from 127.1, the data showed.
Also, Malaysia's unemployment rate declined to 2.9 percent in March from 3.2 percent in February, the Department of Statistics said on Monday. In January, the jobless rate was 3 percent. The number of unemployed persons decreased to around 380,400 in March from about 402,200 in February. On a seasonally adjusted basis, Malaysia's unemployment rate was 2.8 percent during the month, down from 2.9 percent recorded in February.
by RTT Staff Writer
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