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Nikkei Markets

Malaysia shares rise amid optimism over economic growth

Singapore stocks edge lower as U.S.-Syria tensions escalate

KUALA LUMPUR (Nikkei Markets) -- Malaysian stocks rose Thursday, buoyed by optimism surrounding Southeast Asia's third-largest economy. Singapore shares declined, tracking Wall Street's overnight losses amid geopolitical tensions involving the U.S. and Syria.

Malaysia's FBM KLCI index added 0.2% to close at 1,873.62. Singapore's Straits Times Index dropped 0.3% to 3,468.61.

On Thursday, the World Bank raised its forecast for Malaysia's economic growth to 5.4% this year from October's projection of 5%, while predicting that the nation would achieve high-income status between 2020 and 2024. Of the 30 stocks on the KLCI, 20 closed higher. The index had been in the red for most of the afternoon session before likely demand from institutional funds helped a turnaround.

"Investors are positive on Malaysia's sound economic fundamentals," said Vincent Lau, vice-president at broker Rakuten Trade. "This could help fuel the ongoing rally in the KLCI, despite the weaker regional sentiment."

KLCC Property Holdings, the owner of Malaysia's iconic Petronas Twin Towers, added 0.7%. The company may acquire a retail project being developed by Petroliam Nasional, Chief Executive Hashim Washir told reporters after a shareholders' meeting.

IHH Healthcare rose 0.5% after Bloomberg reported, citing unidentified people, that Asia's largest hospital operator plans to outbid a rival to acquire India's Fortis Healthcare.

HSS Engineers jumped 9.5% after an associate secured a contract worth 289.9 million ringgit ($75 million) from Malaysia's Mass Rapid Transit Corp. "The latest win is a positive development, paving the way for more rail-related job orders," Rakuten Trade's Lau said.

Oil-and-gas company Sapura Energy advanced 6.2%, adding to Wednesday's 20.6% gain. Sapura's announcement on Wednesday that the company, along with its partners, had taken a final investment decision to develop a potentially-lucrative gas asset has helped fuel the stock's advance. TA Securities analyst Kylie Chan raised her target price on the stock to 0.84 ringgit from 0.65 ringgit, citing an improved valuation for the company's energy assets.

In Singapore, Oversea-Chinese Banking Corp. was among top losers, dropping 0.9%. Singapore Airlines lost 2.8%.

Fears of a potential escalation of tensions in the Middle East weighed on stock prices in the city-state. U.S. President Donald Trump taunted Russia on Wednesday via a tweet that cautioned the country to "get ready" for a possible missile strike on Syria after a rebel-held town in the war-torn country came under a likely chemical weapons attack over the weekend.

Investors also digested the minutes from the U.S. Federal Reserve's March meeting, which showed that policymakers are expecting the economy to continue expanding and inflation to accelerate.

Water treatment specialist Hyflux soared 19.6%. In response to Singapore Exchange's query on Thursday, the company said it continues to be in talks with several potential investors.

Test handling machine supplier AEM Holdings was among other top gainers, rising 9.2%. Home-grown hardware maker Creative Technology reversed Wednesday's losses to add 2.4%.

In the latest economic news, the Department of Statistics said on Thursday Singapore retail sales rose 8.6% on-year in February, with 3.9% of total from online retail. It attributed the rise in part to the Chinese New Year season.

ST Engineering, which announced Wednesday that its aerospace arm had secured new contracts worth about S$510 million ($389 million) in the first quarter for services ranging from heavy maintenance to engine washes, advanced 0.6%.

--Alexander Winifred & Joannah Perez

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