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Nikkei Markets

Malaysia, Singapore shares climb as banks gain

Thin trading suggests caution over potential US-China trade deal

KUALA LUMPUR (Nikkei Markets) -- Malaysia and Singapore shares rose Friday as positive cues from the U.S. and Asia helped sustain gains, although light trading volume in both markets suggest investors remain cautious.

The FBM KLCI ended 0.7% higher at 1706.38 and the Straits Times Index closed up 1% at 3083.60 as banks rose, while technology stocks remained under pressure. The Malaysian benchmark finished the week with total loss of 0.1% while Singapore's main gauge added 0.2% for the week.

"In Singapore, the non-oil domestic exports data released before markets opened brought upside surprise," IG Asia Market Strategist Jingyi Pan said. "Despite on-going trade tensions, the data showed improved exports growth to other top destinations, giving us a positive, early Q4 signal."

Trade agency Enterprise Singapore reported Friday that Singapore's non-oil domestic exports rose a better-than-expected 8.3% in October from a year earlier. Exports to China continued to trend down - declining 25.8% in October on year - while shipments to the U.S. rose 32.8%.

In Malaysia, data showed the trade-reliant nation's economy decelerated for the fourth quarter in a row in July-to-September as commodity exports and state-backed investments fell, although the central bank expects growth to edge higher in the months ahead.

The Nikkei Asia300 Index climbed 0.4%. All three major U.S. equity indexes ended higher on Thursday after reports of ongoing discussions between the U.S. and China on bilateral trade fuelled optimism over chances of a resolution. Still, uncertainty remains.

The U.S. plans to press ahead with higher tariffs on imports from China in January, Bloomberg reported. The report said U.S. President Donald Trump and Chinese counterpart Xi Jinping are likely to "at best" agree to a framework for further talks when they gather at the G-20 summit this month.

Malayan Banking and CIMB Group Holdings, Malaysia's two largest banks by assets, added 0.8% and 1.1% respectively. In Singapore, Oversea-Chinese Banking Corporation climbed 0.9%, while United Overseas Bank advanced 0.8%.

Singapore's FTSE ST Technology Index was down 0.4% while Bursa Malaysia Technology index fell 0.5% amid broader concerns over weak outlook of U.S. tech giants. The latest was Nvidia, whose shares plunged after missing third-quarter guidance.

In earnings news, sound system manufacturer Formosa Prosonic Industries surged 9.3% in Malaysia after reporting a 14.3% rise in third-quarter net profit. Tune Protect Group meanwhile slumped nearly 10% after the insurance firm posted a 28% drop in net profit in the third-quarter.

In Singapore, Keppel Infrastructure Trust advanced 1.1% after announcing acquisition of Australia-based chemical manufacturer and distributor Ixom HoldCo. The acquisition is expected to be yield accretive, Keppel said.

City Developments edged 0.1% lower after data showed a 48% drop in sales of new private homes in October compared to September. The Urban Redevelopment Authority said this was due to the absence of major launches in October.

- Alexander Winifred and Joannah Perez

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