KUALA LUMPUR, July 7 — Bursa Malaysia opened lower today following Wall Street’s negative performance overnight as traders expect a higher United States non-farm payrolls data for June, which will increase the possibility of the US Federal Reserve (Fed) hiking rates.
At 9.10am, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 2.92 points to 1,383.03 from 1,385.95 at yesterday’s close.
The key index opened 3.75 of-a-point lower at 1,382.20.
The broader market was also negative as decliners beat advancers 178 to 97, while 218 counters were unchanged, 1,767 untraded and 28 others suspended.
Turnover stood at 142.91 million units worth RM57.17 million.
Rakuten Trade Sdn Bhd equity research vice-president Thong Pak Leng said the overnight Dow Jones Industrial Average lost 366 points while the Nasdaq declined by 113 points as the US 10-year yield edged past the 4 per cent mark to 4.031 per cent.
He said Hong Kong equities endured another dreadful day as the Hang Seng Index overnight tumbled by 577 points following the Fed’s minutes indicating more rate hikes coupled with signs of slowing China’s economy that saw the yuan weakened against the US dollar at 7.25 or an eight-month low.
“Back home, the FBM KLCI closed weaker amid a poor regional performance despite Bank Negara Malaysia’s (BNM) stance to maintain the Overnight Policy Rate (OPR), which was widely anticipated.
“We reckon trading on the local bourse will be muted today following the weak close on Wall Street, thus we expect the index to hover within the 1,380-1,390 range,” he told Bernama.
Thong believes technology stocks may experience headwinds in view of the higher interest rates environment in the US going forward.
In a note today, Malacca Securities Sdn Bhd said the FBM KLCI failed to gain momentum yesterday despite BNM keeping the OPR unchanged at 3 per cent.
“We reckon the downward bias trading tone may linger over the foreseeable future as investors may keep their hands off until further clarity after the six state elections on August 12.
“The resumption of selling activities from foreign funds and the weakness of the ringgit against major currencies continue to dampen trading interest.
“On the global front, we reckon the emergence of profit-taking activities with sentiment turning weaker may see negative performances permeating towards the local markets,” it said.
Malacca Securities expects the defensive-related sectors such as real estate investment trust, utilities and healthcare may take the spotlight on the back of renewed volatility, while the property sector may breathe a sigh of relief following BNM’s move to stand pat on the OPR decision.
“The technology sector may see a further pullback, taking its cue from the weakness on Nasdaq overnight,” it said.
Among heavyweights, Public Bank and IHH Healthcare added one sen each to RM3.89 and RM5.81, Maybank and CIMB lost three sen each to RM8.70 and RM5.18, and Tenaga Nasional fell two sen to RM9.05.
Of the actives, Bahvest Resources perked one sen to 23.5 sen, Catcha Digital went up 3.5 sen to 28 sen, EA Holdings inched down half sen to half sen, while Sarawak Consolidated and Tanco were flat at 46.5 sen and 53.5 sen respectively.
On the index board, the FBM Emas Index weakened 23.31 points to 10,197.92, the FBMT 100 Index was 23.57 points lower at 9,893.06, the FBM ACE Index edged down 0.41 points to 5,136.14, the FBM 70 Index narrowed 43.46 points to 13,466.72, and the FBM Emas Shariah Index trimmed 24.65 points to 10,451.69.
Sector-wise, the Financial Services Index gave up 24.72 points to 15,449.48, the Energy Index increased 0.89 of-a-point to 793.05, the Plantation Index shed 7.77 points to 6,853.60 and the Industrial Products and Services Index dropped 0.69 of-a-point to 157.17.
— Bernama
