KLCI down 1.48% as political overtures keep investors on tenterhooks

KLCI down 1.48% as political overtures keep investors on tenterhooks
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KUALA LUMPUR (Feb 24): The FBM KLCI pared some of its loss at mid-morning to regain the 1,500-point level but was down 1.48% as the weekend political overtures kept investors on tenterhooks.

The Edge Financial Daily today reported that the nation’s political landscape could see a major tectonic shift in power in the coming days with a new coalition taking shape, which sees the end of Pakatan Harapan.

At 9.55am, the FBM KLCI was down 22.36 points to 1,508.84. The index had earlier fallen to a low of 1,497.19.

Decliners led advancers by 777 to 68, while 162 counters traded unchanged. Volume was 1.04 billion shares valued at RM810.13 million.

The top losers included Carlsberg Brewery Malaysia Bhd, Heineken Malaysia Bhd, Kuala Lumpur Kepong Bhd, Dutch Lady Milk Industries Bhd, Panasonic Manufacturing Malaysia Bhd, PPB Group Bhd, Aeon Credit Service (M) Bhd, Gamuda Bhd, British American Tobacco (M) Bhd and Ajinomoto (M) Bhd.

The actives included My EG Services Bhd, Alam Maritim Resources Bhd, Sapura Energy Bhd, Bumi Armada Bhd, Iris Corp Bhd, Eduspec Holdings Bhd, Gamuda Bhd and Powerwell Holdings Bhd.

The gainers included Hong Leong Financial Group Bhd, Allianz Malaysia Bhd and Malaysia-listed Hang Seng Index-linked put warrants.

Reuters said global shares and oil extended losses on Monday while safe-haven gold soared as the spread of the coronavirus outside China accelerated, with infections jumping in South Korea, Italy and the Middle East, in a worrying new development in the outbreak.

South Korea put the country on high alert after the number of infections surged to over 600 with six deaths. In Italy, officials said a third person infected with the flu-like virus had died, while the number of cases jumped to above 150 from just three before Friday, it said.

Hong Leong IB Research said in the US, with the re-emergence of cautious tone from market participants, profit-taking activities could persist over the near term.

“Moreover, should the number of cases outside of China continue to increase, sentiment will remain negative and may contribute to further selling pressure on Wall Street. The Dow’s support is anchored around 28,500 at this juncture.

“Tracking the negative performance on overnight Wall Street, coupled with the rising political noise, we believe the upside may be capped Bursa exchange.

“We think the FBM KLCI may decline amid the uncertain political scene which unfolded over the weekend, hence traders could look into trading range around 1,424 should the support at 1,500 is broken.

“At the same time, traders may want to look at gold-related stocks (on the back of gold rally recently) for a short-term trading opportunity,” it said.