KLCI reverses gains as regional markets pull back

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KUALA LUMPUR (Jan 22): The FBM KLCI reversed its gains at the midday break today, in line with the pullback at regional markets spooked by the US federal government shutdown.

At 12.30pm, the FBM KLCI fell 1.6 points to 1,827.23. The index had earlier risen to its intra-morning high of 1,835.21.

Losers edged gainers at 335 to 320, while 592 counters traded unchanged. Volume was 2.45 billion shares valued at RM1.11 billion.

The losers included British American Tobacco (M) Bhd, Ajinomoto (M) Bhd, Petron Malaysia Refining & Marketing Bhd, Petronas Gas Bhd, Aeon Credit Service (M) Bhd, UMW Holdings Bhd, Pentamaster Corp Bhd, Kuala Lumpur Kepong Bhd, Enra Group Bhd and Petronas Chemicals Group Bhd.

The actives included Sumatec Resources Bhd, D.B.E. Gurney Resources Bhd, Sino Hua-An International Bhd, APFT Bhd, PUC Bhd, Sapura Energy Bhd, UMW Oil & Gas Corp Bhd, UCrest Bhd and Hubline Bhd.

The gainers included Dutch Lady Milk Industries Bhd, Hengyuan Refining Company Bhd, Hong Leong Bank Bhd, Petronas Dagangan Bhd, Halex Holdings Bhd, Hartalega Holdings Bhd, Top Glove Corp Bhd and Amway (M) Holdings Bhd.

US stock futures, Asian equities and the dollar pulled back slightly on Monday after the US government was forced to shut down amid a dispute between President Donald Trump and Democrats over immigration, according to Reuters.

MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.1% while Japan's Nikkei was down 0.15%, it said.

Affin Hwang IB senior associate director and head of retail research Datuk Dr Nazri Khan Adam Khan said investors in the US and Europe temporarily ignored the concern about the possibility of government shutdown in US.

Nonetheless, he said historical events showed that a government shutdown always led to a pullback in the market.

"Local stock market is anticipated to congest sideways with upward bias.

"Stocks in Bursa Malaysia remain buoyant with GE14 rally mood still in the progress while any pullbacks should be short lived and perceived as opportunity to buy, backed by positive domestic economic outlook.

"Accumulate quality stocks for long-term investment horizon," he said.