KUALA LUMPUR: Bursa Malaysia gave up earlier gains to end the day almost flat, succumbing to selling pressure in selected heavyweights but supported by buying in financial services counters.
At 5 pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) slipped 0.34 of-a-point to 1,601.54 compared with 1,601.88 at yesterday’s close.
The index opened 4.67 points higher at 1,606.55 and moved between 1,601.54 and 1,616.84.
On the broader market, gainers led losers 619 to 528, while 469 counters were unchanged, 489 untraded and 12 others suspended.
Total volume was lower at 5.85 billion units worth RM4.38 billion from 6.80 billion units worth RM4.82 billion on Tuesday.
Bank Islam Malaysia Bhd economist Adam Mohamed Rahim said the market bellwether ended flat today, declining by less than 0.1 per cent, mainly dragged by counters such as Sime Darby, Petronas Dagangan and IOI Corporation, which all dropped by more than 2.0 per cent.
Nevertheless, banking counters such as CIMB, Hong Leong Bank, Public Bank, and RHB Bank all recorded gains which helped to erase some of the losses in the local bourse.
“The banking sector contributes more than 20.0 per cent of the FBM KLCI’s total market capitalisation, so any gains in the banking counters will provide a boost to the local market.
“The reason for the positive performance of the banking sector was partly due to Bank Negara Malaysia’s (BNM) decision to maintain the Overnight Policy Rate (OPR) at 1.75 per cent which prevents further compression in the banks’ net interest margin,” he told Bernama.
Nevertheless, Adam said, however, BNM is expected to cut the OPR in the next meeting in March.
“The reason is that the Movement Control Order has now been imposed in all states except for Sarawak, as the country is expected to lose RM600.0 million daily, albeit smaller than the daily output loss of RM2.4 billion from March until May 2020,” he said.
On further scrutiny, Adam said the Malaysian Economic and Rakyat’s Protection Assistance Package (PERMAI) worth RM15 billion will be financed by sources of funds coming mostly from the existing Budget 2021 with more prudent spending.
“This will likely have limited impact on the government’s fiscal position and the fiscal deficit will likely remain unchanged at 5.4 per cent of gross domestic product (GDP) for 2021.”
As a result, the government could only afford to focus more in terms of monetary support by reducing the OPR in order to curb the impact from the MCO 2.0 that will have significant bearing on human mobility, said Adam.
“All in all, we reiterate the view that the OPR will be reduced by 25 basis points in the next BNM policy meeting in March 2021 due to the aforementioned circumstances,” he added.
Among the heavyweights, Public Bank increased 42 sen to RM21.32, PChem gained three sen to RM7.54, and Top Glove improved one sen to RM6.14.
In contrast, Maybank eased one sen to RM8.09 and Tenaga inched down four sen to RM9.96.
Of the actives, HPPHB, which made its debut today, surged 35 sen to 71 sen, Anzo increased by 2.5 sen to 10.5 sen, while MTouche was flat at 6.5 sen.
In contrast, Widad shed half-a-sen to 66 sen and DGB Asia retreated five sen to 12.5 sen.
On the index board, the FBM Emas Index climbed 14.14 points to 11,594.66, the FBMT 100 Index expanded 11.6 points to 11,321.86, while the FBM Emas Shariah Index eased 21.98 points to 13,081.36.
The FBM 70 increased 69.72 points to 14,910.57 and the FBM ACE was 56.01 points better at 10,850.38.
Sector-wise, the Financial Services Index bagged 114.22 points to 14,876.43, the Industrial Products and Services Index inched up 0.75 of-a-point to 179.76 while the Plantation Index erased 46.64 points to 7,242.79.
The Main Market volume eased to 3.55 billion shares worth RM3.47 billion compared with 3.89 billion shares worth RM3.62 billion on Tuesday.
Warrants turnover dwindled to 368.51 million units valued at RM62.1 million from 441.37 million units valued at RM62.91 million.
Volume on the ACE Market declined to 1.93 billion shares worth RM847.38 million versus 2.46 billion shares worth RM1.14 billion previously.
Consumer products and services accounted for 709.12 million shares traded on the Main Market, industrial products and services (1.11 billion), construction (265.87 million), technology (347.04 million), SPAC (nil), financial services (100.65 million), property (249.98 million), plantations (62.48 million), REITs (15.4 million), closed/fund (86,000), energy (262.77 million), healthcare (72.73 million), telecommunications and media (52.54 million), transportation and logistics (263.38 million), and utilities (37.7 million). — Bernama