KLCI declines as OPEC disappoints

KLCI declines as OPEC disappoints
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KUALA LUMPUR (May 26): The FBM KLCI fell 1.66 points or 0.1% to 1,772.30 points at 5pm today, after the Organization of the Petroleum Exporting Countries' (OPEC) output cut extension disappointed investors.

Investors had earlier hoped OPEC would do more to support crude oil prices. They were disappointed by the absence of additional cut in crude oil production by OPEC.

Reuters reported at Thursday's meeting in Vienna that OPEC and some non-OPEC producers agreed to extend a pledge to cut around 1.8 million barrels per day, until the end of the first quarter of 2018. The initial agreement would have expired in June this year.

It was reported Brent futures were up 28 cents at US$51.74 a barrel at 0837 GMT today.

In Malaysia today, JF Apex Securities Bhd research head Lee Chung Cheng told theedgemarkets.com that oil and gas share losses weighed on the KLCI. 

“There were some disappointment in the market after OPEC's meeting, a lot of people are expecting a bigger output cut, as you can see there were sell down on the oil and gas stocks, which dragged the whole market sentiment.

“We think this is just temporary; as you can see, oil prices have come up again towards the afternoon, but for next week, we still see sideway trading within the local market,” Lee said.

Bursa Malaysia saw 771 decliners versus 208 gainers. Trading volume was 2.86 billion shares, worth RM2.61 billion.

The biggest decliner was oil and gas entity Petron Malaysia Refining & Marketing Bhd, while Malaysian Pacific Industries Bhd led gainers.