Bursa Malaysia Index falls as regionals weaken yesterday

KUALA LUMPUR: Shares on Bursa Malaysia extended their falls again on Tuesday, as bearish investor sentiment continued to envelop the local and regional bourses.

The KLCI had originally started on a positive footing, gaining as much as nine points in early trading, spurred by bargain hunting activities and a sharp overnight fall in crude oil prices. Crude oil prices had fell by nearly US$4 to just under US$141.37 (RM466.52) per barrel on Monday.

However, those gains could not be sustained as regional markets weakened considerably as the day progressed, with large losses in Hong Kong, Japan and Singapore.

The KLCI fell into negative territory in the afternoon session, and ended the day six points lower at 1,121.3 points. Market breadth was negative with declining stocks beating advancing ones by a 7-to-5 ratio. Trading volume rose slightly from 413 million to 450 million shares.

The day's most actively traded stocks include Gamuda, Scomi, IOI Corp, Sime Darby, TM, MRCB and Resorts. Plantation stocks were the biggest losers as commodity prices in general have fallen sharply in recent days, taking their lead from crude oil. Major losers include KL Kepong, United Plantations, Asiatic, Kulim and Sime Darby. Gainers include Panamy and TMI.

Sentiment among global investors remains bearish. Investors are being troubled by persistent uncertainties, both domestically and globally. Long standing external concerns over the health of the US economy, high crude oil prices and rising inflationary pressures remain. There is no evidence to suggest that prevailing trading conditions are about to change anytime soon.

While the external economic picture has been murky for a while, these problems are being compounded by recent domestic political developments that have created more uncertainties. The confluence of these factors is likely to keep investors sidelined in the near term with most local investors adopting a wait-and-see attitude.