Stocks up on border reopening as market decouples from foreign sell-off


STOCKS on Bursa Malaysia rose as investors cheered the plan of reopening international borders as early as March 1 without the need for mandatory quarantine.

The benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) surged 1.4% or 21.42 points to 1,551.51 yesterday as the market shows signs of decoupling from the sell-off seen in developed markets.

“Investors continued their bargain hunting activities while at the same time optimistic on positive earnings news over the region.

“For the local bourse, we expect the uptrend will continue due to improved market sentiment and renewed optimism while valuation of Malaysian equities is still cheaper compared to regional peers, hence offers better potential upsides for foreign investors,” Rakuten Trade Research VP Thong Pak Leng told The Malaysian Reserve.

Thong said the FBM KLCI is expected to trade within the range of 1,545 to 1,560 for the remainder of the trading week.

Thong said the news of Malaysia moving to open borders will be positive for most counters, but more for aviation and tourism-related stocks.

Shares of AirAsia Group Bhd closed up 2.5 sen to 68.5 sen while airports operator Malaysia Airports Holdings Bhd was up 15 sen to RM6.26. AirAsia was up 9.5 sen on Tuesday on the plan to open borders.

The prospect of foreign tourists back at its facilities saw Genting Bhd advance six sen to RM4.60.

The return of medical tourists, however, failed to be a catalyst to IHH Healthcare Bhd which closed unchanged at RM6.50 while KPJ Healthcare Bhd rose two sen to RM1.10 on the news.

The National Recovery Council’s (NRC) decision was made after a meeting on Tuesday, where the council reviewed a proposal by Immigration Department DG Datuk Seri Khairul Dzaimee Daud to reopen national borders.

NRC chairman Tan Sri Muhyiddin Yassin said the reopening of the country’s border needs to be implemented in a planned and careful manner based on the current risk assessment.

He added that notwithstanding the reopening of Malaysia’s borders, travellers must undergo Covid-19 screening tests before their departure and upon arrival in the country, as per recommendations by the Ministry of Health.

Muhyiddin said the reopening of borders would support the country’s recovery process moving forward.

Malaysia’s international borders have been largely closed since early in the Covid-19 pandemic as the country grappled with multiple waves of Covid-19 infections.

New infections have been on the rise again recently, with daily cases breaching the 10,000-mark last week for the first time in more than four months.

Malaysia reported 17,134 new Covid-19 cases yesterday, the highest daily figure since September last year.