You are here
Southeast Asia stocks: Malaysia gains to near 3-wk high; others mixed
[KUALA LUMPUR] Malaysian stocks rose for a second straight session on Tuesday to their highest in nearly three weeks on the government's decision to abolish fuel subsidies from Dec 1, while other Southeast Asian stock markets traded mixed amid waning optimism over China's rate cut.
The FTSE Bursa Malaysia KLCI Index was up 0.3 per cent at 0736 GMT, led by a 2.9 per cent gain in Petronas Gas .
Malaysia will scrap subsidies for petrol and diesel, the government said on Friday, a move that could potentially result in some 20 billion ringgit (US$5.97 billion) savings annually.
Sentiment was also boosted after the IMF said Malaysia was on track to achieve the 2014 federal budget deficit target of 3.5 per cent, down from 3.9 per cent in 2013 and that it also projected deficit could decline below 3 per cent of GDP in 2015 with fuel subsidy removal.
Stock markets in south-east Asia were buoyed in the previous session after the People's Bank of China cut its benchmark interest rates for the first time in more than two years on Friday to lower borrowing costs and lift a cooling economy that is on track for its slackest annual growth in 24 years.
"Rate cut of China was little bit optimistic, but it has now been factored in," said Song Seng Wun, an economist with Singapore-based CIMB. "But the focus is on whether there will be a rebound in the oil prices." Oil prices lost more ground on Tuesday ahead of a much-anticipated meeting of the Organization of the Petroleum Exporting Countries (OPEC) later this week.
Singapore's Straits Times Index was steady, while the Thai SET index and the Indonesian index were down 0.1 per cent each after hitting their near two-month closing highs in the previous session.
The Philippine index was 0.5 per cent weaker after hitting a two-month closing high in the previous day. Vietnam's benchmark VN Index rebounded 0.9 per cent as investors picked up beaten-down stocks after the index hit a near one-month closing low in the previous session.