KUALA LUMPUR (March 15): The FBM KLCI closed 0.55% lower today in line with the bearish sentiment on Asian markets that were weighed down by the less-than-rosy economic prospects voiced by the Bank of Japan (BoJ). The index was also hit by the underperformance of banking and telecommunications stocks as well as Genting Bhd.
At the close, the KLCI was down 9.39 points at 1,690.92. Overall, gainers led losers by 409 counters to 381 counters, while 381 counters finished unchanged.
Volume was 1.52 billion shares valued at RM1.704 billion.
The top gainers included Kuala Lumpur Kepong Bhd, Panasonic Manufacturing Malaysia Bhd, Syarikat Takaful Malaysia Bhd and Can-One Bhd.
AirAsia Bhd was the most actively traded counter with 65.23 million shares done.
The decliners included British American Tobacco (Malaysia) Bhd, UMW Holdings Bhd, JMR Conglomeration Bhd, Petronas Gas Bhd and Genting.
When contacted, Areca Capital Sdn Bhd chief executive officer Danny Wong said the FBM KLCI was weighed down by the dismal performance of telecommunications and banking stocks as well as Genting.
"Genting has been up a fair bit, but today it is down 2.15%," he said, adding it indicated some profit taking had occurred.
However, he also said the market is down in line with regional markets while lower crude oil prices had also impacted the local market, albeit not significantly.
"More than 90% of traders have indicated by their trades that the market expects the Fed will hold the interest rate, similarly the BoJ," he said.
Reuters reported that Asian stocks fell today after the BoJ expressed more pessimism about the outlook for exports, industrial output and inflation, but the yen firmed as policymakers appeared to back away from any imminent move to cut interest rates further into negative territory.
Japan's Nikkei 225 closed 0.68% lower at 17,117.07 points, South Korea's Kospi was down 0.12% at 1,969.97 points while Hong Kong's Hang Seng closed 0.72% lower at 20,288.77 points.
The news agency also reported that the US Federal Reserve is not expected to raise interest rates this week, but will likely make clear that as long as US inflation and jobs continue to strengthen, economic weakness overseas won't stop rates from rising fairly soon.
Meanwhile, crude oil prices extended losses as concerns arose that a six-week recovery may have petered out due to ongoing oversupply, the news agency reported in a separate article.
The fall in crude oil prices followed the Organization of the Petroleum Exporting Countries (OPEC) statement that global demand for its crude would be less than previously thought in 2016 as supply from rivals proves more resilient to low prices, increasing the excess supply in the market this year, the report stated.
OPEC reportedly expects global demand for its crude to average 31.52 million barrels per day (bpd) in 2016, down 90,000 bpd from last month's forecast.
OPEC also reportedly said it produced 32.28 million bpd in February, down about 175,000 bpd from January, mainly due to outages in Iraq and Nigeria.
But continuously high production figures mean that global output still exceeds demand by at least 1 million bpd, weighing on markets, the report stated.
The April futures contract for West Texas Intermediate (WTI) crude oil dropped 2.29% to US$36.33 per barrel while the contract for Brent crude oil dropped 2.4% to US$38.58 per barrel.