KLCI ends morning session 0.25% lower amid tepid economic data

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KUALA LUMPUR (June 24): The FBM KLCI ended the morning session lower today amid some tepid economic data that portended weaker growth ahead.

Malaysia’s Consumer Price Index (CPI) declined 2.9% year-on-year (y-o-y) in May 2020 to 117.9 versus 121.4 a year earlier.

The Department of Statistics Malaysia (DOSM) said the decrease in the overall index was driven by a decline in transport (-20.8%), housing, water, electricity, gas and other fuels (-2.6%), clothing and footwear (-1.1%), and furnishings, household equipment and routine household maintenance (-0.2%) which contributed 45.7% of overall weight.

Meanwhile, the Leading Index (LI), which provides an early signal of the future economic direction, slumped to negative 5.5% in April 2020 from negative 3.6% in March 2020.

Considering the weaker performance of the annual LI and the LI growth cycle deviation from the long-term trend, it is anticipated that the economy will remain on the contraction trajectory in the coming months, said the DOSM.

At 12.30pm, the FBM KLCI had shed 0.25% or 3.81 points to 1,503.23.

Losers led gainers by 313 to 291, while 649 counters traded unchanged. Trading volume was 2.98 billion shares valued at RM1.12 billion.

The top losers included Petronas Dagangan Bhd, Chin Teck Plantations Bhd, British American Tobacco (Malaysia) Bhd, Kluang Rubber Company (Malaya) Bhd, Ajinomoto (Malaysia) Bhd, Supermax Corp Bhd, QL Resources Bhd, PLB Engineering Bhd and Knusford Bhd.

The actives included Trive Property Group Bhd, MQ Technology Bhd, NetX Holdings Bhd, AT Systemization Bhd, DGB Asia Bhd, Vivocom Intl Holdings Bhd, Iris Corp Bhd and Tadmax Resources Bhd.

The gainers included Heineken Malaysia Bhd, Carlsberg Brewery Malaysia Bhd, Dutch Lady Milk Industries Bhd, Kuala Lumpur Kepong Bhd, Mega First Corp Bhd, Vstecs Bhd, UWC Bhd, New Hoong Fatt Holdings Bhd and PPB Group Bhd.

Reuters said Asian shares crept to a four-month high today as investors remained stubbornly upbeat on the outlook for a reopening of the global economy even as cases of Covid-19 looked to be accelerating to new peaks.

MSCI's broadest index of Asia-Pacific shares outside Japan added 0.39% to reach its highest since early March, though turnover was light, it said.

Kenanga Research said Asian stocks mostly rose yesterday as investors took their cue from Wall Street’s rally.

It said back home, the KLCI dropped by 4.2 points or 0.28% to finish at 1,507.04.

“Following the formation of a 'golden cross', the index managed to close the gap that was opened during the mid-March market meltdown, which sees it now trading above all of its key SMAs (simple moving averages).

“On the chart, our support levels are identified at 1,450 (S1) and 1,410 (S2).

“On the upside, our resistance levels are at 1,530 (R1) and 1,590 (R2),” it said.