KUALA LUMPUR (Nov 27): The FBM KLCI closed lower for a second day today, in line with the overall weaker performance at key regional peers, down 0.5 points or 0.03% lower at 1,682.59 points.
While many regional indices were dragged down by China's industrial companies' profit contractions, the local benchmark seemed to be insulated from this phenomenon.
Inter-Pacific Securities head of research Pong Teng Siew told theedgemarkets.com that while the KLCI is heavily supported by local institutions, the local benchmark index is susceptible to foreign institutions' net-buying, which seem to be inconsistent from day to day.
"Foreign funds seem to be undecided with Malaysia now; they now have a neutral view on Malaysia. They are inconsistently on a net-buying position. Some days they do buy, some days they don't.
"The KLCI is now very sensitive to foreigners' net-buying," he said.
Most of the 30 KLCI constituents were in the red today, notably UMW Holdings Bhd, which yesterday reported a 93.14% drop in its third quarter net profit to RM13.52 million. Other blue chips that finished lower included Astro Malaysia Holdings Bhd, Petronas Chemicals Group Bhd, IHH Healthcare Bhd and Westports Holdings Bhd.
But the situation was worse on the broader market, as the small cap rally last week seemed to be reversing.
Pong pointed out decliners outnumbered gainers (at 635 and 292 respectively), and the trading volume of 2.41 billion was a big comedown from the peak of 3.41 billion last Thursday.
In total, the shares traded today were valued at RM2.06 billion.
Today's most active stocks were XOX Bhd, China Stationery Ltd and Instacom Group Bhd.
Latitude Tree Holdings Bhd became today's biggest gainer, after closing 32 sen or 4.37% higher at RM7.64. It was followed by PPB Group Bhd and Panasonic Manufacturing Malaysia Bhd.
The worst decliners included Fraser & Neave Holdings Bhd (F&N), British American Tobacco (Malaysia) Bhd and Kobay Technology Bhd.
Many key regional indices fell today. Japan's Nikkei 225 dropped 0.3%, China's Shanghai Composite Index lost 5.48%, Hong Kong's Hang Seng Index ceded 1.97%, Korea's Kospi Index lost 0.08%, and Singapore's Straits Times Index dropped by 0.89%.
Reuters reported that Chinese shares slumped on Friday, weighing on other Asian stock markets, as a fresh regulatory crackdown and falling industrial profits weighed on market sentiment.
(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)