KUALA LUMPUR (Mar 16): The FBM KLCI fell in the final trading minutes as a weaker ringgit amid cheaper crude oil hit investors' sentiment.
The KLCI closed 1.21 points or 0.07% lower at 1,780.54 points at 5pm as oil and gas-related stocks like SapuraKencana Petroleum Bhd fell.
“Overall, the KLCI is still reacting to the ups and downs of oil prices. It started with losses in the morning mainly because global crude oil prices have come down quite a fair bit over the weekend.
“But, the market is also adjusting to the movements in oil prices and investors are slowly shifting their focus away from oil and gas counters to other sectors like consumer. In particular, poultry farmers appear to be in play and are showing their strength among the top performing counters,” a remisier told theedgemarkets.com.
Reuters reported that oil prices continued to tumble, with U.S. crude dropping more than 2 percent at one point to a six-year low amid oversupply fears. The International Energy Agency said on Friday that the global supply glut is growing and U.S. production shows no sign of slowing.
U.S. crude shed about 1.2 percent to $44.31 a barrel, while Brent crude lost about 0.6 percent to $54.32.
The ringgit weakened to 3.7045 versus the US dollar and changed hands at 2.6641 to the Singapore dollar. The ringgit is softening against a surging US dollar, in anticipation of an earlier-than expected interest rate hike in the US.
The KLCI, which opened in the red, had earlier rebounded as investors eyed gains in China markets.
Reuters reported that Hong Kong shares rose on Monday in step with strong gains in mainland markets on expectation that China will loosen policy to bolster its slowing economy, but analysts say the strenthening U.S. dollar is having a negative effect on Hong Kong stocks.
Across Asia, Hong Kong’s Hang Seng was up 0.53%, South Korea’s Kospi rose 0.08% while Japan’s Nikkei was lower by 0.04%%
At Bursa Malaysia's market close, the exchange saw 2.46 billion stocks changed hands valued at RM1.89 billion.
Decliners advanced with 504 counters, outnumbering the 294 gainers.
Top gainers included Petronas Dagangan Bhd and Oriental Food Industries Holdings Bhd. Top decliners included Nestle (M) Bhd and Syarikat Takaful Malaysia Bhd.
The most actively traded stock was Sumatec Resources Bhd, an oil and gas counter.