KUALA LUMPUR (Dec 11): The FBM KLCI fell 8.51 points or 0.5% while the ringgit depreciated on lower crude oil prices and ahead of the US interest rate decision next week.
At 5pm, the KLCI closed at 1,640.14 on losses in stocks like SapuraKencana Petroleum Bhd and Tenaga Nasional Bhd. The ringgit weakened to 4.2965 against the US dollar.
Malacca Securities Sdn Bhd technical analyst Loui Low said Bursa Malaysia saw low trading volume on weaker sentiment. Bursa saw 1.61 billion shares worth RM1.88 billion traded.
Low said the US' potential rate hike and lower crude oil prices were negative to the stock market.
"The trading volume is low today. This implied that investors are moving away from the stock market. (Weaker sentiment) was mainly due to low crude oil price," he told theedgemarkets.com via telephone.
US policy makers will meet this Tuesday and Wednesday (Dec 15 and 16) to decide on the country's monetary policy. A US rate hike does not bode well for emerging Asian markets like Malaysia, as investors turn their attention to US dollar-denominated assets.
The ringgit's strength tracks prices of crude oil, which forms a major component of the Malaysian economy.
Reuters reported that crude oil prices remained at levels not seen since early 2009 on Friday as output in the Middle East continued to rise despite an already huge global glut, with analysts saying the price outlook for the rest of the year and into 2016 remained weak.
Brent crude futures were down 9 cents at US$39.64 a barrel at 0745 GMT, not far from the almost seven-year lows hit earlier in the session at US$39.38 a barrel.
In Malaysia, Bursa decliners beat gainers at 477 against 306 while 355 counters remained unchanged.
The top gainer was British American Tobacco (M) Bhd while the leading decliner was Nestle (M) Bhd.
SapuraKencana and Tenaga were the fifth and seventh most-active stocks.
SapuraKencana fell two sen or 1% to RM1.94, while Tenaga dropped eight sen or 0.6% to RM13.14.
The KLCI tracked losses in certain Asian markets. Hong Kong's Hang Seng declined 1.11% while South Korea's Kospi declined 0.18%.
Japan's Nikkei 225 was, however, 0.97% higher.
(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)