Forex Marketz Daily Forex News – Fully Markets Update
Malaysian market wrap: Shares gain nearly 1% this week, ringgit slips again
KUALA LUMPUR (NewsRise) – Malaysian shares ended the week almost 1% higher, as cash-rich state-run funds continued to support the market through hefty purchases.
However, shares ended lower Friday even as Asian stock markets were mixed, as investors turned cautious ahead of a key U.S. jobs data later today.
The nation’s benchmark FTSE Bursa Malaysia KLCI closed down 0.3% at 1628.80 weighed by a decline in heavyweight stocks like Genting and Malayan Banking. 14 of Malaysia’s 30-stock index ended in the red, while market breadth were neutral with 397 advancers, 364 losers and 322 were unchanged.
The Malaysian ringgit, the worst performing Asian currency so far this year, fell 0.9% in early trade to 4.4415 to a dollar, before recovering to close at 4.4150. It ended the week with a 0.7% loss. Fresh worries that Malaysia may miss its aim of balancing the budget by 2020 weighed on the currency that has shed more than 20% against the greenback this year. A Thursday report in the New Strait Times, citing Prime Minister Najib Razak’s comments to investors in New York that indicated the budget gap may be in the region of 1% of gross domestic product by 2020, added to the woes of the local currency, already battered by falling global crude oil prices and an ongoing political tumult.
Asia’s major markets ended mixed. While Japan’s Nikkei was little changed, South Korea’s Kospi index retreated 0.5% and Hong Kong’s Hang Seng Index rose 3.2%.
Southeast Asian markets swooned as investors remained on guard ahead of the release of U.S. September employment data that would signal the strength in the world’s biggest economy, and could influence the Fed’s decision later in October and December.
Singapore’s Straits Times Index fell 0.3% while the Jakarta Composite Index slipped 1.1% and the Philippines’ Stock Exchange Index declined 0.6%. Thailand’s SET Index bucked the trend with a 0.2% rise.
“It’s hard to say if Asian markets have been genuinely concerned by the payrolls report, but there has been a modest risk off feel to today’s trade,” said Melbourne-based IG market analyst Chris Weston.
AirAsia, Asia’s largest budget carrier by fleet, closed flat at 1.26 ringgit after the company said it is injecting $140 million into Indonesia AirAsia to help its associate airline avoid a suspension. Rubber glove producer Top Glove Corp, seeking to complete an acquisition in the next one year in a bid to accelerate growth, fell 0.3% to 7.95 ringgit.
Malayan Banking, Malaysia’s biggest bank by assets, declined 1.2% at 8.45 ringgit while gaming-and-resort giant Genting was 2.2% lower at 7.28 ringgit.
Next week, investors will be watching Malaysia’s external trade data and international reserves data after recent improvements in manufacturing activity. The Nikkei Malaysia Manufacturing Purchasing Managers’ Index for September, rose to 48.3 from August’s 47.2 thanks to new export orders and increase in employment.
Any sharp downside to the Malaysian shares may be limited in the fourth quarter after recent correction, said Yvonne Tan, a general manager at Eastspring Investments, the Asian asset management arm of UK-based insurance giant Prudential plc, which manages assets worth $6.85 billion.
Still, foreign outflows may persist, triggering further weakness in the ringgit, but “we are positive because there is a lot of cash in the system and the fourth quarter is a seasonally strong quarter,” she added.
The KLCI has lost nearly 5% in the third quarter after a string of disappointing corporate earnings results and analyst downgrades that exacerbated foreign outflow. Foreign investors have offloaded more than 17.7 billion ringgit of Malaysian shares since January, surpassing the 6.9 billion ringgit outflow for the entire 2014.
Malaysian market wrap: Shares gain nearly 1% this week, ringgit slips again
