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KUALA LUMPUR (Dec 11): Bursa Malaysia’s Financial Services Index rose more than 4% to snatch the highest percentage of gain from the energy gauge in mid-morning trading today, as stock prices in the Banks rose among Bursa, the top winners, following the equity market bets. who are considered beneficiaries of an economic recovery after the interruptions caused by the Covid-19 pandemic.
The impact of the gain on bank share price was also evident in FBM KLCI’s rise of 30 shares, considering financial services index constituents such as Public Bank Bhd, Hong Leong Financial Group Bhd (HLFG), and Malayan Banking Bhd (Maybank) are also members of KLCI.
At 11:36 a.m. M., The Financial Services Index had risen 625.21 points or 4.08% to 15,944.25 to become the highest percentage gain among Bursa indicators, while the KLCI was 26.17 points or 1.58% higher at 1,680.56.
The Energy Index, which tracks the prices of stocks of oil and gas (O&G) companies, added 2.73% after crude prices rose to more than $ 50 a barrel.
Earlier today, the energy gauge had risen 3.6% as of 10:27 a.m. as O&G-related companies emerged between Bursa’s top earnings and most active stocks.
In Bursa at 11:40 a.m. M., The share price of Public Bank, the main winner, had risen RM1.90 or 9.41% to RM22.10, while HLFG rose 58 sen or 3.22% to RM18.58 and Maybank rose 30 sin or 3.58% at RM8.68.
Today, analysts at TA Securities Holdings Bhd wrote in a note that while the index heavyweights, led by banks, rose higher yesterday, the market as a whole relaxed into a healthy respite from profit-taking to consolidate the strong recent gains and neutralize the overbought momentum.
“The KLCI gained 7.86 points to close at 1,654.39, from an initial low of 1,647.65 and a high of 1,658.07, but the losers outnumbered the winners from 644 to 568 in relatively slower turnover that totaled 8.1 billion. of shares worth RM 4.8 billion. [yesterday].
“Given recent strong gains driven by economic recovery plays, stocks should loosen on profit-taking consolidation today, with investors looking to reduce exposure before the weekend,” analysts said.
In the O&G sector, Affin Hwang Investment Bank Bhd analyst Tan Jianyuan wrote in a note today that Affin Hwang expects the sector to remain choppy in 2021 and that global oil prices are likely to be volatile until a surge is observed. recovery of more sustainable demand and supply dynamics.
Tan said the risk persists with the Organization of the Petroleum Exporting Countries + (OPEC +) potentially reducing production cuts.
“We believe that capex (capex) may be delayed until oil prices show more signs of stabilization. As such, earnings growth may remain mediocre at least during 1H21 (the first half of 2021). However, the sector may experience some trading opportunities for high beta stocks.
“Given the uncertainty and volatility expected in 2021, we remain cautious and favor stocks with resilient earnings and good execution records, accompanied by high returns, if any. Our ‘buy’ requires Dialogue. [Group Bhd], Petronas Trading [Bhd], Fully dynamic [Holdings Bhd], Gas Malaysia [Bhd] and Bumi Armada meet this criteria, ”said the analyst.
According to online reports, OPEC + comprises 13 OPEC members and 10 of the world’s top non-OPEC oil exporting countries.
Members of OPEC + include Malaysia, Azerbaijan, Bahrain, Brunei, Kazakhstan, Mexico, Oman, Russia, South Sudan, and Sudan.
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