KLCI pares loss, broader market stays negative as external worries linger

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KUALA LUMPUR (Dec 18): The FBM KLCI pared some of its loss at mid-morning today but the broader market sentiment remained negative, tracking regional bourses.

At 10am, the FBM KLCI was down 1.51 points to 1,640.11. The index had earlier fallen to a low of 1,638.09.

Losers led gainers by 476 to 98, while 204 counters traded unchanged. Volume was 565.33 million shares valued at RM280.79 million.

The losers included Fraser & Neave Holdings Bhd, Panasonic Manufacturing Malaysia Bhd, Kuala Lumpur Kepong Bhd, Heineken Malaysia Bhd, Petronas Dagangan Bhd, Carlsberg Brewery Malaysia Bhd, United Plantations Bhd, KESM Industries Bhd, Petron Malaysia Refining & Marketing Bhd and ViTrox Corp Bhd.

The actives included V.S. Industry Bhd, Hubline Bhd, Sumatec Resources Bhd, Bumi Armada Bhd, Priceworth International Bhd, Hibiscus Petroleum Bhd and KNM Group Bhd.

The gainers included Nestle (M) Bhd, Public Bank Bhd, Hong Leong Industries Bhd, Ajinomoto (M) Bhd, Selangor Properties Bhd and Pensonic Holdings Bhd.

Asian share markets stumbled on Tuesday as heightened concerns about a slowing global economy sent Wall Street stocks skidding to their lowest levels in more than a year, according to Reuters.

MSCI's broadest index of Asia-Pacific shares outside Japan shed 0.25% in early trade while Japan's Nikkei tumbled 1.5%, it said.

Hong Leong IB Research in a traders' brief said investors would remain unhinged by the major macro headwinds that have buffeted markets in recent months: rising interest rates, slowing global growth and US-China trade tensions.

"All eyes are on the upcoming FOMC (Federal Open Market Committee) meeting as the outcome of the events will be affecting markets' tone significantly, with the Fed widely expected to raise rates by 25 basis points and reduce the quantum of previously scheduled three hikes in 2019. Key resistances are 24,000-24,500 while supports are near 23,000-23,300.

"On the local front, we anticipate bearish undertone to prevail in view of external headwinds (e.g. trade tensions and political uncertainty, intensifying worries of global economic outlook, and monetary policy normalisation by central banks) and internal clouds surrounding the slowing corporate earnings, compounded by weak crude oil and FCPO (crude palm oil futures) prices.

"Major supports are set at 1,614-1,631 whilst resistances are near 1,670-1,682," it said.