KLCI remains below 1,700-level as key blue chips drag

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KUALA LUMPUR (Dec 6): The FBM KLCI drifted lower and remained below the 1,700-level in early trade this morning, tracking regional markets.

At 9.05am, the FBM KLCI fell 4.24 points to 1,684.03.

The early decliners included Nestle (M) Bhd, British American Tobacco (M) Bhd, Kuala Lumpur Kepong Bhd, Petronas Gas Bhd, Hartalega Holdings Bhd, Tenaga Nasional Bhd, IOI Corp Bhd, Malaysia Airports Holdings Bhd, Sime Darby Plantation Bhd and UMW Holdings Bhd.

U.S. stock futures tumbled on Thursday and Asian markets followed after Canadian authorities arrested a top executive of Chinese tech giant Huawei Technologies, fanning fears of further tensions between China and the United States, according to Reuters.

S&P500 e-mini futures fell almost 2 percent at one point in thin Asian morning trade and were last were down 0.7 percent, it said.

Hong Leong IB Research in a traders’ brief said in the US, trade developments will be one of the biggest factors that could heighten the volatility on global markets.

“Hence, investors will be eyeing closely on any new trade developments throughout the 90-day window for further investment decisions. Also, the inversion of yield curve will be taking part of the limelight, which may cause concerns over the economic slowdown. At this juncture, the Dow is likely to fluctuate near the SMA200 (25,100) level.

“We believe markets have digested part of the concerns on the new trade developments and China has issued a statement but lack of details to shrug off the confusions on promises made in Argentina.

“Hence, we believe it may provide slight optimism for bargain hunting activities to emerge, lifting the stock markets marginally over this week. The FBM KLCI could trade higher towards the 1,700 level over the near term,” it said.