KUALA LUMPUR (July 28): The FBM KLCI remained in negative territory at mid-morning today after several government-linked companies (GLCs) have had their credit ratings downgraded, after the recent downgrade of sovereign local-denominated bonds due to the government's deteriorating fundamentals in the wake of slowing global growth.

Declines at Genting Bhd-linked stocks also weighed on the benchmark index.

Genting faced heavy selling pressure from foreign investors this morning.

An analyst told theedgemarkets.com this may have been due to foreign selling prompted by the US Department of Justice (DOJ) investigation on 1Malaysia Development Bhd (1MDB), as Genting had sold power assets to 1MDB earlier.

Yesterday, Fitch Ratings downgraded the long-term local-currency issuer default ratings (IDRs) of national oil corporation Petroliam Nasional Bhd (Petronas), insurance companies Etiqa Insurance Bhd and Etiqa Takaful Bhd — both of which are part of the Malayan Banking Bhd group — and MNRB Holdings Bhd's Malaysian Reinsurance Bhd by one notch.

At 12.30pm, the FBM KLCI fell 8.73 points to 1,654.83.

Losers outpaced gainers by 421 to 225, while 327 counters traded unchanged. Volume was 1.18 billion shares valued at RM812.48 million.

The top losers included British American Tobacco (Malaysia) Bhd, Genting, Lafarge Malaysia Bhd, Dutch Lady Milk Industries Bhd, Amway (Malaysia) Holdings Bhd, Batu Kawan Bhd, Heineken Malaysia Bhd, Petronas Dagangan Bhd and Ajiya Bhd.

The actives included PDZ Holdings Bhd, TH Heavy Engineering Bhd, Naim Indah Corporation Bhd, Sumatec Resources Bhd, Sanichi Technology Bhd, Hiap Teck Venture Bhd and AirAsia X Bhd.

The gainers included Panasonic Manufacturing Malaysia Bhd, Ajinomoto (Malaysia) Bhd, Vitrox Corporation Bhd, Hong Leong Industries Bhd, Perak Corporation Bhd, Unisem (M) Bhd, DKSH Holdings (Malaysia) Bhd and Yinson Holdings Bhd.

Asian stocks edged up on Thursday after the Federal Reserve provided an positive assessment of the world's largest economy and lifted risk sentiment, according to Reuters.

The dollar fell, however, as some in the currency market had hoped the Fed would give a clearer indication that it could raise rates within the year, it said.

Kenanga IB Research said the FBM KLCI experienced another muted trading session as it inched 2.14 points or 0.13% higher to close at 1,663.56 points on tepid trading volume.

It said overall market breadth turned the tide during the final hour, as bulls outpaced the bears with 430 advancers against 343 decliners.

The research house said that technical-wise, the benchmark index is still consolidating sideways between its short- and long-term SMAs.

"The continued tepid relative strength index and Stochastic are still reinforcing the view that buying interest is thinning in the market.

"With the lack of fresh catalyst, we continue to view that the local bourse will trade range bound within 1,650–1,670 this week.

"Resistance levels are seen at 1,680 (R1) and 1,700 (R2), with supports envisaged at 1,662 (S1) and 1,650 (S2)," it said.