KUALA LUMPUR (July 28): The FBM KLCI declined 5.06 points or 0.3% on news Fitch downgraded Malaysia's ringgit-denominated debt rating. The KLCI had also dropped on Asian share market losses.

At 5pm, the KLCI closed at 1,658.50 points after Fitch said it downgraded Malaysia's long-term ringgit bonds to A- from A. Malaysia's downgrade prompted Fitch to downgrade the debt of government-linked companies including Petroliam Nasional Bhd (Petronas).

Across Asian share markets, Japan's Nikkei 225 fell 1.13% while Hong Kong's Hang Seng dropped 0.2%.

Reuters reported that Asian stocks were mostly lower on Thursday as Chinese equities deepened their losses, souring risk sentiment that had improved earlier after the Federal Reserve provided a positive assessment of the US economy.

Japan's Nikkei declined more than 1%, undermined by a stronger yen and nerves before the Bank of Japan's monetary policy decision on Friday (July 29).

In Malaysia today, MIDF Amanah Investment Bank Bhd equity head Syed Muhammed Kifni Syed Kamaruddin told theedgemarkets.com that besides the KLCI's parallel performance with other regional markets, Fitch's decision to downgrade the debt ratings of several government-linked companies might have also engendered knee-jerk selling in the stock market.

"We pegged the immediate support level for the KLCI at 1,640 points. The market's performance may be range bound at between 1,640 points and 1,670 points in the near term," Syed Muhammed said.

Across Bursa Malaysia, decliners led gainers by 467 to 300. Volume was 2.22 billion shares valued at RM1.85 billion.

Top decliners included British American Tobacco (M) Bhd, Chin Teck Plantations Bhd and Genting Bhd. Top gainers included Panasonic Manufacturing Malaysia Bhd, Dutch Lady Milk Industries Bhd and Ajinomoto (M) Bhd.

PDZ Holdings Bhd was the most-actively traded counter with some 270 million shares transacted.