KLCI volatile, ringgit weakens

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KUALA LUMPUR (Feb 11): The FBM KLCI vacillated between gains and losses as investors eyed overnight US stock gains and optimistic Malaysian economic data besides prospects of volatile crude oil prices.

Investors might have also assessed the impact of Malaysia's highest court decision yesterday to reject opposition leader Datuk Seri Anwar Ibrahim's appeal against his sodomy conviction. Anwar faces a five-year jail term after his appeal was rejected.

Today, the KLCI rose 0.15 point or 0.01% to 1,811.27 at 9:04am before erasing gains. The index was traded lower at 1,810.58 at 9:14am.

M&A Securities Sdn Bhd research head Rosnani Rasul said crude oil markets and Malaysia's industrial output numbers could have an impact on domestic shares.

In a note today, Rosnani said the country’s industrial output, which grew 7.4% in December 2014 from a year earlier, might indicate that the nation's full-year gross domestic product (GDP) growth  had come in higher than 2013's 4.7% expansion.

Bank Negara Malaysia will announce the country's fourth quarter and full-year 2014 GDP numbers tomorrow.

Today, Reuters reported that crude oil prices fell for the first time in four sessions on Tuesday after the International Energy Agency warned that ample supplies will raise global inventories before investment cuts begin to significantly dent production.

As a result, the ringgit weakened against world currencies as crude oil is a major component of the Malaysian economy.

The ringgit weakened versus the US dollar at 3.5835, and compared to the Singapore dollar, the ringgit depreciated to 2.6446.

Rosnani said "oil may suffer softness once the US is certain on its policy rate hike path."  

Bursa Malaysia saw some 132 million shares worth RM45 million changed hands. There were  111 gainers versus 72 decliners.

The top gainer was Syarikat Takaful Malaysia Bhd while the leading decliner was Dutch Lady Milk Industries Bhd. The most-active stock was ETI Tech Corp Bhd.

Across Asian stock markets, Australia's S&P/ASX 200 fell 0.52% while South Korea's Kospi rose 0.3%. Japan markets are closed for a holiday today.

Reuters reported that Asian markets got off to a cautious start on Wednesday as looming euro zone meetings over Greece overshadowed a firmer finish on Wall Street.

Euro zone finance ministers meet later on Wednesday and EU leaders on Thursday, but officials are already downplaying the chance of a breakthrough.