Tuesday 19 Mar 2024
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KUALA LUMPUR (Feb 12): The FBM KLCI continued to stay in the red today, as investors remained concerned the government's decision to cut electricity tariffs will have an impact on Tenaga Nasional Bhd (TNB).

At the closing bell, the bellweather index slipped 0.55% or 9.88 points, to settle at 1,789.07 points. It had dropped to an intra-day low of 1,780.21 earlier.

Stocks like TNB, Fraser & Neave Holdings Bhd and Dutch Lady Milk Industries Bhd were among the underperformers today.

Apart from the three stocks, Petronas Dagangan Bhd was one of the top decliners.

“The biggest factor that had caused the plunge of the FBM KLCI was still TNB, as it is one of the heavyweights in the local exchange,” RHB Research executive chairman Lim Chee Sing told theedgemarkets.com.

Lim said Petronas-linked stocks also fell on spillover effects from the Energy, Green Technology and Water Minister Datuk Seri Maximum Ongkili announcement yesterday (Feb 11) that electricity tariff would be reduced 5.8% or 2.25 sen per kWh for consumers in Peninsular Malaysia.

“The negative sentiment had carried through today, despite TNB [CEO] clarifying that the government’s decision to cut electricity tariffs has no impact on the company,” said Lim.

The sentiment in global markets did not help either, said Lim. “Greece threatening to exit the eurozone has added implications for the global financial markets.”

Although crude oil prices have been sustaining above the level of US$55 a barrel, Lim said the Organisation of the Petroleum Exporting Countries’ decision to give discounts to the Asian users, would imply oil prices to go down further.

“Investors are not convinced that the oil prices has hit the bottom,” he added.

Lim also noted the ringgit has weakened against the greenback. The ringgit was quoted at 3.6045 against the US dollar, at the time of writing.

“Added to the concern is that in a recent teleconference, Fitch Ratings has more or less made up its mind to downgrade Malaysia’s sovereign ratings,” Lim cautioned, adding that investors are also worried about the staggering debts of 1MDB.  

Notably, the KLCI had tumbled 0.67% or 12.17 points to 1,798.95 yesterday (Feb 11), dragged down by utility giant TNB whose share price fell 3.1% yesterday (Feb 11), following the announcement of a revised electricity tariff.

The local bourse saw 1.68 billion shares worth some RM2.51 billion traded today, with losers leading gainers at 436 over 326. About 329 counters remained unchanged.

Asia Bioenergy Technologies Bhd was the most actively-traded stock. The counter dropped 3.70% to end the day at 13 sen.

Top gainers included British American Tobacco (Malaysia) Bhd, Kuala Lumpur Kepong Bhd, Syarikat Takaful Malaysia Bhd, Kluang Rubber Company (Malaya) Bhd, V.S. Industry Bhd, Latitude Tree Holdings Bhd and Guiness Anchor Bhd.

Top decliners were Aeon Credit Service (M) Bhd, Tasek Corp Bhd, Nestle (Malaysia) Bhd and Berjaya Auto Bhd.

Regionally, Japan’s Nikkei 225 climbed 1.85%, while Singapore’s Straits Times Index dipped 0.74% today.

Asian stocks and the euro fell on Thursday, as markets erred on the side of caution over the ongoing Greek debt negotiations, amid conflicting headlines on progress in the talk, Reuters reported.

It added crude oil rebounded as conflict in Ukraine escalated and as Saudi Arabia and Russian energy giant Gazprom discussed cooperation between OPEC and its non-OPEC oil producers.

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