Malaysian shares recovered from a soft start to end higher on Thursday, helped by news the country's largest pension fund will invest an extra one billion ringgit ($263 million) on stocks.
Blue chips, such as casino-and-power group Genting and top cellphone operator Maxis, led the rebound after the main stock index sank below the psychological 870-point support level.
The 100-stock Composite Index closed up 0.42 percent at 879.50 points, after hitting an early low of 869.99. Overall volume was a moderate 638 million shares, up from Wednesday's 605 million. Gainers beat losers 448 to 390.
Prime Minister Abdullah Ahmad Badawi is expected to cement his grip on power in the coming polls, and analysts have said a strong victory would be a boost for the stock market. Top lender Maybank, the market's largest stock, fell 2.6 percent to 11.20 ringgit, shaving 2.2 points off the Composite Index.
Maybank had led a recent rise in banking shares, with the stock up over 10 percent in the last two weeks, as investors bought into the sector on the back of a strengthening economy.
RHB Capital dropped 0.4 percent to 2.40 ringgit after the firm terminated talks with German insurer Allianz AG to merge their non-banking businesses in Malaysia.
Small steel-maker Kinsteel ended flat at 1.72 ringgit after falling 1.2 percent earlier. Sources told Reuters the firm's plans for a 100 million ringgit bond issuance and a 68 million ringgit rights shares and warrants sale would hit the market in the second quarter.
Malaysia's Employees Provident Fund (EPF) said late on Wednesday it had released an extra one billion ringgit to 12 external fund managers, bringing the total amount managed by such firms to 8.0 billion ringgit.
EPF, with over 200 billion ringgit of assets, is among the biggest investors in Malaysia's stock market.