FBM KLCI slips 0.65% amid weakening ringgit

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KUALA LUMPUR (March 11): The FBM KLCI declined 0.65% today, amid the weakening of the ringgit against the US dollar, as concerns of an earlier interest rate hike spooked markets in the region.

At 5pm, the benchmark index fell 11.57 points or 0.65% to close at 1,778.16 points.

A remisier said the index fell in line with other markets in the region, with the weaker ringgit as the main factor behind the KLCI’s decline today.

“The ringgit fell to around RM3.70 against the dollar, its lowest in six years, as the dollar strengthened on worries of a potential hike in interest rates by the US,” he said.

Similarly, Maslynnawati Ahmad, chief economist of MIDF Amanah Research, said the volatility of the ringgit is likely to continue for the next three months, due to market expectations of an interest rate hike by the US Federal Reserve in June.

She added that the weaker ringgit is also due to the negative sentiment on the Malaysian economy, following a slump in global crude oil prices.

According to Bloomberg, the ringgit weakened to RM3.6973 against the US dollar, and traded at RM2.6651 against the Singapore dollar.

The exchange saw some 2.49 billion shares worth RM2.23 billion exchanged. Market breadth was negative with 523 decliners against 321 gainers, while 294 counters were unchanged.

Leading the decliners was IJM Plantations Bhd, while Atlan Holdings Bhd led the gainers. The top active stock was The Media Shoppe Bhd.

Across the region, South Korea’s Kospi fell 0.2%, while Hong Kong’s Hang Seng closed 0.75% lower.

Reuters reported Asian stocks skidded to a two-month low on Wednesday, as nervous markets recoiled on worries about an earlier U.S. interest rate hike — a prospect that sent the dollar to a 12-year high against the euro.