Friday 29 Mar 2024
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KUALA LUMPUR (Dec 11): The FBM KLCI fell 0.98% in early trade on Thursday, in line with the slump at regional markets.

At 9.01am, the FBM KLCI lost 17.30 points to 1,748.22 weighed by losses at key bkue chips including Petronas-linked counters and banks.

The top losers included Petronas Gas Bhd, Petronas Dagangan Bhd, Public Bank Bhd, Hong Leong Bank Bhd, PPB Group Bhd, Hong Leong Financial Group Bhd, Sime Darby Bhd, Maxis Bhd, IOI Corporation Bhd and Tenaga Nasional Bhd.

Regionally, Asian stocks fell early on Thursday as falling oil prices continued to feed into global growth concerns, while the dollar lost more ground against peers such as the yen and euro after a further drop in U.S. bond yields, according to Reuters.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.2 percent as another large drop in oil prices took a heavy toll on energy shares and hit Wall Street hard overnight, it said.

M & A Securities research head Rosnani Rasul in a marjket preview Thursday said Wall Street was hammered yesterday, the worst in the last few months, hurt none other by oil.

She said the S&P 500 and DJIA erased 33.68 (-1.64%) and 268.05 (-0.51%) points to end at 2,026.14 and 17,533.15 respectively.

Rosnani said as if the blood bath of late was not enough, the global equity market would certainly bleed today, taking cue from the haemorrhage from Wall Street.

She said few negative events yesterday will make the investors rattle including 1) Saudi Arabia's oil minister reiteration that he has no plans to cut output 2) OPEC’s projection where it expects demand for its crude to fall to 28.9 million barrels per day next year, 400,000 barrels per day less than in 2014.

Rosnani said OPEC’s official production target is 30 million barrels a day, which would mean far more oil on the world market than is being consumed and 3) US Energy Department report which showed a surprise increase in U.S. crude supplies of 1.5 million barrels last week.

She said the outcome of this would certainly hurt market sentiment in oil producing country like Malaysia, Indonesia, Russia and Brazil.

“These are also the country that will be vulnerable when the US policy rate starts to hike next year.

“As for the local market, the double whammy will come from the disappointing increase in crude palm oil stocks level which had reached 2.2 million tonnes, hampered by lower export.

“In a nutshell, the market will be slippery today,” she said.

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