Shares buckle, oil slumps amid Covid-19 jitters

Shares buckle, oil slumps amid Covid-19 jitters
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KUALA LUMPUR (March 30): The FBM KLCI closed 14.21 points or 1.06% lower today at 1,328.88 as crude oil prices slumped amid jitters from the Covid-19 pandemic’s global economic impact as countries restrict movement to curb the outbreak. 

At 5pm, the KLCI closed at 1,328.88 after falling to its intraday low of 1,317.39, as crude oil prices slumped below U$20 a barrel. Crude oil prices fell on expectation the Covid-19 outbreak will erode demand at a time when the Saudi Arabia-Russia price war leads to anticipation of higher supply of the commodity in world markets.

“The key issue for investors at this moment at this time is how long the pause in economic activity as a result of the virus will continue, and how much of an economic impact will be present.

"What is happening is not just in Malaysia, it is also happening on a global level,” Rakuten Trade Sdn Bhd research vice president Vincent Lau told theedgemarkets.com today. 

Across Bursa Malaysia today, 2.83 billion shares were traded for RM1.86 billion.

A total of 511 counters declined while 305 gained. Top active stocks included oil and gas-related counters Bumi Armada Bhd and Hibiscus Petroleum Bhd, which saw some 64 million and 48 million shares traded respectively.

Bumi Armada’s share price closed down 0.5 sen or 3.7% at 13 sen while Hibiscus fell one sen or 3.08% to 31.5 sen.

Globally, Reuters reported that oil prices fell sharply on Monday, with US crude briefly dropping below US$20 and Brent hitting its lowest level in 18 years, on heightened fears that the global coronavirus shutdown could last for months and demand for fuel could decline further.

It was reported that Brent crude, the international benchmark for oil prices, was down US$2.09, or 8.4%, at US$22.84 by 0917 GMT, after earlier dropping to US$22.58, the lowest since November 2002.

US West Texas Intermediate (WTI) crude fell US$1.11, or 5.2%, to US$20.40. Earlier in the session, WTI fell as low as US$19.92, according to Reuters.