KLCI turns negative as trade war anxiety weighs

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KUALA LUMPUR (July 5): The FBM KLCI turned negative at midday break today in tandem with most regional markets, on investors’ anxiety ahead of the Friday deadline for additional U.S. tariffs on Chinese products.

At 12.30pm, the benchmark FBMKLCI dipped 0.62 points to 1,687.83. The index had earlier risen to its intra-morning high of 1,691.62.

Decliners led advancers by 273 to 250, while 498 counters traded unchanged. Volume was 1.27 billion shares, valued at RM668.89 million.

Top losers included Allianz Malaysia Bhd, United Plantations Bhd, Public Bank Bhd, Heineken Malaysia Bhd, Batu Kawan Bhd, Aeon Credit Service (M) Bhd, Hong Leong Industries Bhd and Panasonic Manufacturing Malaysia Bhd.

The actives included Nova MSC Bhd, Barakah Offshore Bhd, Sapura Energy Bhd, IFCA MSC Bhd, Ucrest Bhd and My E.G. Services Bhd.

Gainers included Carlsberg Brewery Malaysia Bhd, British American Tobacco (M) Bhd, Nestle (M) Bhd, Supermax Corp Bhd, Muda Holdings Bhd, DRB-Hicom Bhd, KESM Industries Bhd and Malayan Banking Bhd.

Asian stock markets declined, with the region’s shares falling to the lowest in nine months, ahead of the planned implementation this week of trade restrictions between the U.S. and China. The yuan slipped despite the strongest fixing to its daily reference rate since October, according to Bloomberg.

Shares in Tokyo headed for their lowest level since March, while equity benchmarks in China, Hong Kong and South Korea fell at least 0.5%. 

Australian stocks outperformed, while U.S. futures pared gains. Treasury yields ticked higher as trading resumed, after the Independence Day holiday and the dollar steadied. 

Earlier, the euro got a lift and market pricing for a September 2019 interest-rate hike jumped as some European Central Bank policy makers were said to be uneasy that investors aren’t betting on an increase until December next year, Bloomberg said.

Affin Hwang Capital Research said the FBM KLCI Index managed to stage a slight rebound, edging 8.08 points higher yesterday.

“The local index has been consolidating the past few days, amidst the lack of fresh catalysts.

“The FBM KLCI Index likely to move sideways, with slight upward bias in the near-term,” it added.