October 8, 2011 by staff
Bursa Malaysia, The stock market extended gains yesterday, as investors were positive in 2012 and welcomed the budget proposals of the European Central Bank (ECB) plans to protect lenders in the region since the crisis of sovereign debt.
The benchmark FTSE Bursa Malaysia Kuala Lumpur Composite Index (KLCI FBM) opened the trading session higher the level of 1,400 points during the morning session.
However, when trading reopened at 2:30 pm, the benchmark index began to lose strength, and was trading at as low as 1391.31 points around 15:30.
When the 2012 budget began to speak, the index was within the range of 1.396 to 1.398 and its bullish momentum that pushed 0.48 percent higher to close at 1400.05 its highest close in more than wo weeks.
“Overall, I think this is a budget that will help stimulate economic growth. By putting the money in the hands of lower income group, they spend the money almost immediately.
“Therefore, we can see an immediate impact on the economy,” said Pong Teng Siew, Jupiter Securities head of research, when contacted by Business Times yesterday.
The Government will present the new program of civil service pay – that ultimately could improve civil servants’ salaries significantly.
For example, the DG48 grade teachers, who receive a maximum salary of RM6, 325.39, see an increase of 37.7 percent to RM8, 710.
This should help lenders such as Malaysia Building Society Bhd (MBSB) and ICE, Capital Bhd, which most retail customers are public servants.
In Asia, major stock markets continued to rally yesterday. Tokyo closed 0.98 percent higher, Sydney ended 2.29 percent higher in Hong Kong rose 3.11 percent and Seoul rose 2.89 percent.
The positive investor sentiment in the region was driven primarily by the ECB’s decision to keep interest rates. He also announced measures to strengthen banks pushed the euro zone.
The bank opened two long-term credit lines to banks and promised to buy up to e40 billion (RM169 billion) of bonds backed by a bank in November.
The measure has eased concerns that the crisis in Greece could spread to other parts of the region.
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