FBM KLCI climbs after China announces tariff cuts on US imports

KUALA LUMPUR (Feb 6): The FBM KLCI closed up 15.98 points or 1.04% today as general market sentiment was boosted following China's announcement that it will cut tariffs on US imports.

The benchmark index's gain — it settled at 1,552.77 points at 5pm — was on account of investors taking cue from the positive development of the US-China trade relations ahead of the Phase 2 trade deal talks, said Rakuten Trade Sdn Bhd research vice president Vincent Lau.

In addition, the index was lifted by continued bargain hunting activities, said Lau. "The government's plan to introduce a stimulus package to bolster the economy is also a key catalyst that lifted the KLCI,” Lau added.

The FBM KLCI's climb was in line with other Asian stocks' jump today as investors in the region reacted to positive developments on the US-China trade front, according to CNBC.

“Beijing said Thursday it would halve tariffs on hundreds of US imports from 1:01 pm on Feb 14," CNBC reported, quoting a statement from China’s Ministry of Finance website.

Reuters wrote that Beijing's unexpected announcement could ease one of the biggest risks to global economic growth that has also been threatened by the coronavirus epidemic in China, who is the biggest trading partner to most of its neighbours.

Japan's Nikkei 225 gained 2.38%, while South Korea's Kospi rose 2.88%, while Hong Kong's Hang Seng rose 2.64% and China's Hang Seng index climbed 1.72%.

On Bursa Malaysia, there were 602 gainers versus 276 losers, while 403 stocks remained unchanged. A total of 3.08 billion shares worth RM2.48 billion were exchanged.

Among the top gainers that lifted the benchmark index was MISC Bhd, which surged 29 sen or 3.64% to close at RM8.25, followed by Genting Malaysia Bhd, whose shares rebounded nine sen or 3.06% to close at RM3.03. Yesterday, the casino operator's shares fell to RM2.94 — its lowest since January last year — amid fears about the impact of the Wuhan coronavirus outbreak on its business.