Bursa rises on buying interest in banking, telco stocks

KUALA LUMPUR: Bursa Malaysia's trading volume increased today, driven by renewed interest in select banking and telecommunications firms, according to an analyst. Thong Pak Leng, Rakuten Trade Sdn Bhd's equity research vice-president, indicated that major regional indices closed mixed after a weaker lead from Wall Street on Friday.

However, Thong noted that technology stocks remained strong, as renewed optimism surrounding artificial intelligence boosted demand for chipmakers. Simultaneously, Beijing announced a 360 billion yuan investment into state-owned banks and insurers, including 300 billion yuan funded through special Treasury bonds, providing a potential lift to China's sentiment.

Thong expressed caution despite today's positive performance due to high crude oil prices and the rise in the US 10-year Treasury yield. He further suggested that higher energy prices could maintain global inflationary pressures, while escalating bond yields might continue to dampen risk appetite as investors reassess the outlook for US interest rates.

However, increased buying in banking and telecommunications giants, combined with robust domestic fundamentals, should offer some support to the benchmark index. Thong expects the FBM KLCI to trade within the 1,700-1,730 range this week. With buying interest potentially emerging during weakness but external headwinds limiting a stronger advance, Thong anticipates the FBM KLCI to remain within the aforementioned range.