Malaysian shares prices closed on Tuesday 0.6 percent on higher amid hopes that the US Federal Reserves will lower interest rates after a policy meeting later in the day, dealers said. The Kuala Lumpur Composite Index (KLCI) closed up 9.03 points at 1,434.16.
Volume was 739.74 million shares, valued at 1.45 billion ringgit (438 million dollars) with 394 decliners and 383 gainers. At the close, the ringgit was quoted at 3.3125/3155 against the US dollar. Lim Chee Sing, RHB Research Institute managing director, said a US rate cut would benefit Asia, including Malaysia, as it would help restore confidence and pull the world's largest economy from the brink of a sharp slowdown.
"Stock markets will react positively if the Fed cuts interest rates," Lim said. "The situation in the US is getting worse. People are expecting the Fed to cut interest rates by at least 25 basis points and more than half are expecting a 50-basis-point cut," he added. Among index heavyweights, state-run Telekom Malaysia gained 50 sen to 11.70 ringgit.
Maybank, the largest banking group in the country by assets, added 20 sen to 11.80 ringgit while national Power Company Tenaga fell 10 sen to 9.75 ringgit. Sime Darby, the world's largest listed palm oil plantation company, rose 20 sen to 11.40 ringgit.
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