KUALA LUMPUR (Oct 27): Malaysian shares and the ringgit may take the cue from US economic data, which include higher new home sales. A more optimistic US economic outlook could lead to expectation of near-term interest rate hikes there.

Overnight crude oil and US share losses may also dictate Malaysian share and ringgit trades today.

US rate hikes do not bode well for Asian markets in anticipation that investors will shift their funds into US dollar-denominated assets. Cheaper crude oil may direct the spotlight on Malaysian oil and gas support-service providers.

Yesterday, the FBM KLCI fell 3.51 points to close at 1,673.92 points while the ringgit weakened to 4.1590. In overnight US share trades, the S&P 500 fell 0.17%, Nasdaq Composite was 0.63% lower while Dow Jones Industrial Average climbed 0.17%.

Crude oil prices fell. Brent and  US oil dropped 1.6% each to US$49.98 and US$49.18 a barrel.

Reuters reported that US economic data showed new home sales unexpectedly rose and both wholesale and retail inventories increased in September, while the goods trade deficit narrowed sharply, suggesting a stronger pickup in economic growth in the third quarter than is currently anticipated.

Oil settled down more than 1% on Wednesday even after a surprise drawdown in US crude inventories, as traders remained cautious that OPEC would be able to cut production come late November.