KLCI falls 1.79% on global economy growth concerns

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KUALA LUMPUR (Sept 21): The FBM KLCI tracked regional market losses today, following the fallout from the US Federal Reserve's decision to hold interest rates, which have raised concerns about global economic growth.

At 5pm, the benchmark index closed 29.98 points or 1.79% lower at 1,639.47 points, after touching its intraday low of 1,638.83 points earlier.

It closed at 1,669.45 points last Friday (Sept 18).

Some 1.6 billion shares, worth RM1.84 billion, changed hands during the day. Market sentiments were largely bearish, with losers outpacing gainers by 526 to 274, while some 292 counters remained unchanged.

Nestle (Malaysia) Bhd led the gainers by rising 94 sen to close at RM72.98, though trading margin was thin, with 20,100 shares done.

The top losing counter, British American Tobacco (Malaysia) Bhd, declined 80 sen to close at RM61.50, after 83,400 shares were traded.

Meanwhile, the most active counter was AirAsia Bhd, which announced a share buy-back mandate last Friday. The counter rose seven sen or 5.34% to close at RM1.38, after 95.87 million shares changed hands.

This was followed by AirAsia X Bhd, which inched up one sen or 4.76% to close at 22 sen, after some 60.92 million shares were traded, making it the third most active stock of the day.

Malacca Securities Sdn Bhd's technical analyst, Loui Low, told theedgemarkets.com the key index is likely to remain in a downtrend within the next one month, due to a lack of near-term catalyst.

"The index had breached the 1,680 level and is likely to head towards the next support level of 1,600," Low said.

"Should the 1,600 level be breached, the next support level would be at 1,560," he added.

Despite the prevailing bearish mood, Low said exports, technology and plastics related counters should still provide good investment opportunities.

In the currency market, the ringgit weakened 1.8% against the US dollar, to end the trading hours here at 4.2720; it also depreciated 0.57% against the Singapore dollar to trade at 3.0340 as at 4.59pm.

Reuters reported Asian shares and emerging currencies fell on Monday, after the Fed's decision to keep interest rates at record lows had raised fresh concerns about growth globally, particularly in China.

European markets are set to follow suit, with financial spread betters expecting Britain's FTSE 100 to slip 0.4% Germany's DAX 0.5%, and France's CAC 40 0.2%–0.3%.

US stock futures slipped 0.4% during trading hours in Asia, suggesting further weakness on Wall Street after major indexes fell more than 1.3% on Friday on worries slower overseas demand will hurt corporate profits, it also said.

Regionally, all key indexes are down. South Korea's Kospi was down 1.57%, Hong Kong's Hang Seng fell 0.75%, while Japan's Nikkei 225 is closed until Thursday for public holidays.

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