FBM KLCI lower as yuan devaluation raises China growth concerns

FBM KLCI lower as yuan devaluation raises China growth concerns
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KUALA LUMPUR (Oct 9): The FBM KLCI closed down 1.6 points or 0.09% along with Asian shares after China allowed its currency to depreciate. The yuan's devaluation raised concerns on China's economic growth.

At 5pm, the KLCI settled at 1,774.15 points. Across Asia, Japan’s Nikkei 225 closed 1.32% lower while Hong Kong’s Hang Seng fell 0.11%.

"With Chinese economic momentum continuing to weaken alongside increasing pressure from the United States, currency weakness is the obvious release valve," Reuters quoted JPMorgan analysts as saying in a note.

In Malaysia, JF Apex Securities Bhd head of research Lee Chung Cheng told theedgemarkets.com that trading activities were “muted” today, and it is expected to be the same for the rest of the week.

Lee added: "There are external factors affecting regional market sentiment."

Reuters reported that Asian shares hit 17-month lows on Tuesday as China allowed its currency to slip amid recent losses in domestic share markets, a shift that pressured other emerging currencies.

China's Central Bank fixed its yuan at 6.9019 per dollar on Tuesday, so breaching the 6.9000 barrier and leading speculators to push the dollar up to 6.9120 in the spot market.

Across Bursa Malaysia, trading volume was 1.8 billion shares worth RM1.53 billion.

The biggest decliners included Petronas Gas Bhd and MI Equipment Holdings Bhd. Top decliner Petronas Gas fell 44 sen to close at RM18.30.