KLCI falls amid tech selloff as US-China trade war fears linger

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KUALA LUMPUR (March 28): The FBM KLCI closed down 4.58 points or 0.2% today while Bursa Malaysia's technology index fell by a larger quantum in step with Asian markets. Asian shares dropped after US equities fell overnight due to concerns about tighter controls on the technology sector and as US-China trade war fears linger.

Reuters reported that Asian shares fell on Wednesday after Wall Street was knocked hard by concerns about tighter controls on the tech industry, denting a brief global equities recovery driven by hopes that the risk of a US-China trade war was easing. It was reported that Asian shares extended losses further after China's state-run Global Times reported China will soon announce a list of retaliatory tariffs on United States exports to China.

It was reported that US S&P500 mini futures fell 0.4 percent in Asia, a day after the S&P 500 lost 1.73 percent and the Nasdaq Composite dropped 2.93 percent, making it the benchmark indexes' fourth decline in five sessions. The info tech sector was the worst hit with a fall of 3.5 percent, as investors expect tighter control on the industry following a furore over use of Facebook data by political consultants.

At Bursa Malaysia, the KLCI closed at 1,857.87 at 5pm while the technology index was 0.61 point or 1.83% lower. Across Asia, Japan’s Nikkei 225 closed down 1.34% while Hong Kong's Hang Seng was 2.5% lower.

Inter-Pacific Securities Sdn Bhd head of research Pong Teng Siew said KLCI's decline was unsurprising given that investors remained concerned over trade barriers the US and China had been raising against one another.

“Investors were overconfident initially that the situation would ease, but it seems that the trade war is still on,” Pong told theedgemarkets.com.