THE local stock market ushered in the last month of the year with massive losses, triggered by growing fears over the effects of sliding crude oil prices on the economy and the government’s revenue.

While the market had already been falling in recent weeks, tracking the decline in crude oil prices, the sell-off was exacerbated by OPEC’s decision not to cut production quotas and more ominously, a warning by national oil company PETRONAS that dividends to the government and capital expending in the sector could be cut.

This in turn affected the ringgit too, which posted its steepest two-day decline since 1998.

Some 12 stocks fell for every one that rose on Monday, led by oil and gas stocks.

Regional sentiment was also fragile, as energy counters worldwide traced the slump in oil prices, which in turn has also dragged other commodities lower.

Lower consumer spending over holidays in the US also dampened investors’ mood. European stocks retreated after a three-week rally while stocks in China fell after the release of soft manufacturing data indicated a slowing economy.

The FBM KLCI fell by 2.34% to close at 1,778.3.

 My portfolio returns declined by 1.11% to RM 101,822.9.

The portfolio started on 8 July 2014 with a capital of RM100,000. Since then, it has outperformed the FBM KLCI by 7.9%, and has registered an annualised return of 4.5%.

Total profits currently stand at RM 1,823.

I am currently only 34% invested and hold two stocks, namely Willowglen and Crescendo. Yesterday, both stocks were down by 3.1% and 3.3%, respectively.

This article first appeared in The Edge Financial Daily, on December 2, 2014.