KLCI ends lower as Bursa small caps rise

KLCI ends lower as Bursa small caps rise
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KUALA LUMPUR (Dec 26): The FBM KLCI closed down 0.68 point or 0.04% today at 1,603.55 on profit taking, as investors appeared to favour small market capitalisation stocks (small cap) over big caps.

Trading participation across Bursa Malaysia fell below its year-to-date average due to the year end holiday, analysts said.

Across Bursa at 5pm today, volume was 1.9 billion shares worth RM1.05 billion. There were 428 gainers versus 305 decliners.
“Trading participation today was low, below 2019 average volume of 2.5 billion shares. Most of the people are still on holiday, so we expect the KLCI would remain range bound, before seeing some buying interest in 2020," Malacca Securities Sdn Bhd senior analyst Kenneth Leong told theedgemarkets.com.

“We deem the KLCI being undervalued currently, as it is trading at 15.8 times forward [price-to-earnings ratio], compared to its 10-year average of 17.3 times. The sentiment is improving now, as US-China governments are expected to sign a partial trade deal in January 2020,” Leong said.

Today, the KLCI underperformed indices for smaller market capitalisation stocks across Bursa. The small cap index closed up 89.7 points or 0.64% at 14,046.43, while the FBM ACE added 72.07 points or 1.42% to 5,149.30.

Across Bursa, notable decliners included Petronas Gas Bhd and Public Bank Bhd, while top gainers included Gas Malaysia Bhd, after the stock's price closed up 10 sen or 3.77% at RM2.75.

Gas Malaysia shares ended higher today, after the company said on Tuesday (Dec 24) that the approved average base tariff for its wholly-owned subsidiary Gas Malaysia Distribution Sdn Bhd (GMD) is RM1.573/GJ/day. Gas Malaysia said the approved average base tariff for GMD is for the regulatory period beginning Jan 1 2020 to Dec 31 2022.

"The distribution tariffs for this regulatory period is expected to contribute positively towards the financial position of the company for the next regulatory period of three years," Gas Malaysia said.