KLCI down on China trade slump; PetDag, PChem and Top Glove fall

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KUALA LUMPUR (Jan 14): The FBM KLCI closed down 7.06 points or 0.42% at 1,676.16 today after news on the shock contraction in China exports hit global shares and crude oil markets.

Across Bursa Malaysia, 2.18 billion shares worth RM1.42 billion were traded. A total of 523 stocks ended lower compared with 257 gainers. Top decliners included Petronas Dagangan Bhd, Petronas Chemicals Group Bhd and Top Glove Corp Bhd.

Petronas Dagangan shares closed down 60 sen at RM25.40, Petronas Chemicals dropped 35 sen to RM8.35 while Top Glove fell 14 sen to RM4.66. Petronas Chemicals and Top Glove fell amid a strengthening ringgit against the US dollar.

At the time of writing, the ringgit was traded at 4.1010 against the US dollar. Over the past year, the ringgit strengthened to current levels after depreciating to its weakest point against the US dollar at 4.2020.

Across Asian share indices today, the Shanghai Stock Exchange Composite declined 0.71%, Hong Kong's Hang Seng dropped 1.38% while South Korea's Kospi fell 0.53%.

Reuters reported that latest data from China showed imports fell 7.6 percent year-on-year in December when analysts had predicted a 5 percent rise while exports unexpectedly dropped 4.4 percent, confounding expectations for a 3 percent gain. The disappointing numbers reinforced fears US tariffs on Chinese goods were putting a big strain on China's already cooling economy.

It was reported that oil prices fell by almost 1 percent on Monday, with Brent crude slipping below US$60 per barrel, after Chinese data showed weakening imports and exports in the world's biggest trading nation and second-largest crude oil consumer.
International Brent crude oil futures were at US$59.91 per barrel at 0403 GMT, down 57 cents, or 0.9 percent from their last close. US West Texas Intermediate (WTI) crude futures were down 47 cents, or 0.9 percent, at US$51.12 a barrel.

CNBC reported that Asia Pacific markets started off the trading week mostly on the back foot as China's disappointing trade data spooked investors. Major indexes in South Korea, China and Singapore tumbled Monday afternoon. The market in Japan was closed today for a public holiday.

In Malaysia, TA Securities Holdings Bhd technical analyst Steven Soo told theedgemarkets.com that the KLCI's decline was caused by disappointing Chinese export and import data. Soo said investors saw this as a negative surprise.

“Due to the [sluggish performance], Chinese trade data has also pulled down [Brent] oil price to below US$60 per barrel, as the slower growth in China has raised concern on oil demand,” he said.