KLCI extends losses on beaten down O&G stocks, ringgit depreciates

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KUALA LUMPUR (Nov 5): The FBM KLCI extended losses as oil & gas (O&G) counters took a beating on falling prices of crude oil. The ringgit weakened further against the US dollar.

At 5pm, the KLCI declined 8.07 points or 0.4% to 1,839.29 points, led by losses in O&G heavyweights like SapuraKencana Petroleum Bhd and Petronas Dagangan Bhd (PetDag).

PetDag was also the leading decliner on the stock exchange. Yesterday, the KLCI fell 5.98 points or 0.3% to close at 1,847.36.

Today, Maybank Investment Bank's regional chartist Lee Cheng Hooi told TheEdge Markets.com that the KLCI appeared to be on a "gentle downward correction"

“Declining oil prices have caused most of Malaysia's O&G stocks to come under heavy selling pressure,” Lee wrote in an email.

Lee foresees Brent crude oil trading towards US$79.50 a barrel.

Brent and West Texas Intermediate crude oil futures continued its slide to US$81.81 and US$76.62 a barrel respectively.

Bursa Malaysia saw 2.3 billion shares worth RM2.01 billion traded. Market decliners defeated gainers by 576 versus 251 while 288 counters were unchanged.

The top gainer was Tasek Corp Bhd warrant, Tasek-PA while the most-active counter was Malaysian Airline System Bhd (MAS).

MAS shares were actively traded ahead of its extraordinary general meeting tomorrow. The company will seek shareholders' consent for the planned privatisation of the airline.

Today, the falling ringgit versus the US dollar continued to be closely watched as the local unit weakened further to RM3.3455 from RM3.3290 yesterday.

The dollar and US stock futures pushed higher on Wednesday after Republicans scored a sweeping victory in US mid-term elections, while Asian shares wilted and oil prices extended losses after more soft economic data from China, according to Reuters.

In Asia, South Korea’s Kospi fell 0.19% while Hong Kong’s Hang Seng closed 0.56% lower.

Japan's Nikkei 225 however rose 0.44%.