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Stocks

Malaysian shares recoup last week's losses on value buying

KUALA LUMPUR (NewsRise) -- Malaysian shares rose Monday as bargain buying in beaten down stocks helped the benchmark index erase almost all of last week's losses.

The nation's benchmark FTSE Bursa Malaysia advanced 0.65% to 1,668.26 points. The index had slipped 0.66% last week, underperforming most of its regional peers. The KLCI is headed for its second consecutive monthly advance, but is down 1.4% for the year.

SapuraKencana Petroleum, Genting Malaysia, IHH Healthcare and PPB Group led advances on the KLCI on Monday, while IOI Corporation, Westports Holdings and Tenaga Nasional were the only index stocks to end lower.

The ringgit declined 0.21% to 4.062, sliding for a sixth consecutive session, as broad strength in the dollar, a decline in crude prices and concerns about the health of state fun 1Malaysia Development weighed on sentiment. The ringgit ended at its lowest level since June 28 Monday.

The dollar index, measured against a basket of major currencies, is trading near fourth-month highs, supported by a spate of upbeat U.S. economic data.

Markets are focused on the outcomes of the Federal Reserve and Bank of Japan meetings this week, with the U.S. central bank likely to stand pat and the Japanese authority widely expected to ease policy.

Recent gains in global equities have stemmed from expectations that global central banks act to temper the impact of the so-called Brexit.

Earlier this month, the Bank of England possible stimulus in August as it awaited more information to assess the impact of Britain's vote to leave the European Union, while the European Central Bank last week kept policy unchanged but signaled its readiness to act.

Over the weekend, policymakers from Group of 20 nations affirmed their commitment to support global growth and trade at a meeting in China, boosting risk sentiment.

In Southeast Asian markets on Monday, Thailand's SET index and Philippine's PSE Composite advanced 0.22% and 0.3% respectively, while Indonesia's Jakarta Stock Exchange Composite rose 0.45%. Singapore's Straits Times slipped 0.53%.

In the rest of Asia, China's Shanghai Composite and Hong Kong's Hang Seng rose 0.10% and 0.13% respectiely, while South Korea's KOSPI advanced 0.24%. Japan's Nikkei 225 index slipped 0.04%.

On the KLCI, 24 of the 30 constituents ended higher Monday, while overall advancing issues outnumbered declining ones 415 to 364.

"Looking ahead, the KLCI is expected to remain in a consolidation mode this week. It needs fresh catalysts to move higher amidst stretched valuation, softening crude oil prices, wavering economic growth prospect," Kalaadher Govindan, head research at TA Securities, said in a note.

Overseas investors bought 31.2 million ringgit ($8.5 million) in the nation's equities last week, slowing substantially from 764.2 million the week ago, according to MIDF Research. For the year, foreign inflows now stand at 853.8 million.

Last week's top losers, IHH Healthcare, PPB Group, Genting Malaysia, SapuraKencana Petroleum, rose Monday on bargain hunting.

Asia's largest hospital operator IHH Healthcare advanced 1.85% to 6.6 ringgit. The stock slid 2.6% last week weighed by concerns about its Turkish operations in the wake of mounting political unrest.

PPB Group ended 1.39% higher at 16.06 ringgit, recovering a part of last week's 4% decline sparked by a profit warning from its associate Wilmar International.

Oil services major and leisure SapuraKencana rose 2.84% to 1.45 ringgit, leading losses on the KLCI and erasing nearly all of last week's 3.5% loss. Hospitality major Genting Malaysia gained 2.5% to 4.51 ringgit, reversing last week's 2% slide.

Plantation and property developer IOI Corp slipped 0.23% to 4.28 ringgit. The stock has declined 1.4% this month, erasing a part of June's near 5% advance. Analysts expect the company's membership suspension from the Roundtable on Sustainable Palm Oil to remain a drag on the stock.

Logistics major Westports Holdings led losses on the KLCI with a 0.46% decline to 4.31 ringgit.

Tenaga Nasional was the only other index constituent to end lower, slipping 0.14% to 14.3 ringgit.

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