KUALA LUMPUR (Thomson Financial) - Malaysian shares were higher at midday on Monday as investors were encouraged by gains on Wall Street and by the local central bank's decision to keep interest rates unchanged.
Bargain hunting in plantation stocks lifted the key index.
Wall Street advanced on Friday as firmer-than-expected economic data eased worries about the credit crunch and its impact on the U.S. economy.
Malaysia's Bank Negara kept the overnight policy rate (OPR) at 3.50 percent on Friday, saying raising interest rates would not solve the problem of rising prices, and that slowing growth would eventually correct inflation going forward.
'The decision by Bank Negara to leave the OPR unchanged has been well received, leading the market higher,'' said Phua Kwee Hock, an analyst at SJ Securities. 'The KLCI remains very much on an uptrend.''
'The current improved sentiment as evidenced by the expanding volume, could lead the local market to stage a sustainable recovery if volatility on Wall Street can be kept in check,'' analysts at MIMB Investment Bank said in a note.
The Kuala Lumpur Composite Index (KLCI) was up 13.26 points or 1.2 percent at 1,155.01.
The FTSE Bursa Malaysia 30-large cap index gained 83.87 points or 1.1 percent to 7,448.35, while the FTSE Bursa Malaysia second board index added 33.21 points or 0.6 percent to 5,452.12.
Advancers led decliners 367 to 115, with 162 stocks unchanged and 718 untraded.
Volume was 440 million shares valued at 454 million ringgit.
Cellular operator Digi.com topped gainers, jumping 2.5 percent to 24.50 ringgit while stock exchange operator Bursa Malaysia advanced 3.6 percent to 7.15 ringgit.
Among plantation stocks, midcap Glenealy Plantations surged 13.0 percent to 5.20 ringgit while IOI Corp was up 2.7 percent to 5.65 ringgit and Sime Darby was unchanged at 8.0 ringgit.
National power company Tenaga rose 3.1 percent to 8.35 ringgit, Telekom Malaysia gained 2.9 percent to 3.56 ringgit and Maybank, the largest bank in Malaysia, was flat at 7.55 ringgit.
The ringgit stood at 3.2660/2665 to the U.S. dollar at midday.
-TFN
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