Thursday 28 Mar 2024
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BANGKOK (Dec 1): Malaysia's key stock index hit the lowest in more than six weeks on Monday as state oil firm Petroliam Nasional's plans to cut capital expenditure and falling oil prices hit oil and gas shares.

Petronas said late on Friday that it will cut capex for next year by 15-20 percent because of the falling oil prices.

Kuala Lumpur's composite index was down 2.1 percent at 1,782.76, having hit 1,781.32, the lowest since Oct. 17.

Losses were led by a 12.5 percent drop in shares of Sapurakencana Petroleum and a 13.8 percent loss in shares of UMW Oil and Gas Corporation.

Most Malaysian oil and gas services companies have exposure to, or depend on, contracts with Petronas and the cut in capex will have a negative impact on their earnings in the future, analysts said.

"Oil and gas shares were hit by Petonas's plan to cut spending. The trend was also sentiment driven due to weak global oil prices," said a Kuala Lumpur-based analyst.

 

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