The benchmark index closed 11 points higher at 1,341 yesterday as gainers outpaced decliners by 555

By  SHAHEERA AZNAM SHAH / Pic By ARIF KARTONO

THE move to save jobs at small and medium scale businesses with a RM10 billion stimulus package helped boost investor sentiment and lead the local equity market higher.

The benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) closed 11 points higher at 1,341 yesterday as gainers outpaced decliners with 738 and 183 respectively, while 281 counter were unchanged.

Volume on the local stock exchange remained high with 5.99 billion shares exchanging hands valued at RM2.61 billion.

“At this point, the massive US stimulus has put a floor to the US stock market for now, as it seems to have averted expectations of a deep recession or depression.

“Global markets are now getting the first quarter of the economic and corporate data, and will be rerating equity markets accordingly.

“As the FBM KLCI has been maintaining a range between 1,300 and 1,350, we expect it to stay there given that the upside risks are improvements in the number of positive Covid-19 cases and containment, and that is not a near-term probability,” StashAway Malaysia Sdn Bhd country manager Wong Wai Ken told The Malaysian Reserve.

He projected a similar trend for the ringgit performance against the greenback as the global economies are currently being strengthened with financial stimulus and increasing the money supply.

“The ringgit has weakened to the 4.40 range against the US dollar, given the relative strength the dollar has as a safe haven currency.

“However, the ringgit has strengthened back to the 4.30 range in the past week, and we expect it to stay rangebound as governments worldwide are stimulating their economies by taking more debt, thus increasing the money supply and maintaining the relative strength of currencies,” he said.

On oil prices, AxiCorp Financial Services Pte Ltd chief market strategist Stephen Innes said price gains could be capped following the absence of an updated deal between the OPEC countries and Russia.

“In the absence of any positive news flows from the OPEC, gains could be capped. There is a good chunk of oil traders who think a deal will happen and are in buying the dip.

“It makes sense for an oil producer to front-load the short-term pain for some medium-term gains, and at a minimum, it will provide a line of defence from oil prices falling into single digits,” he said yesterday.

At 5.50pm yesterday, the Brent crude oil futures contract fell 3% or US$1.05 to US$33.06 (RM144.14) a barrel while the US West Texas Intermediate futures contract dipped by 2.93% to around US$27.51 per barrel.

The OPEC and other major producers are expected to meet on Thursday to seek an agreement on production cuts.