Local bourse seen to trade range-bound this month
PETALING JAYA: Local refiners and other oil and gas (O&G)-related counters fell amid cautious investor sentiment brought about by the threat of a global trade war.
The resignation of a key economic adviser to US President Donald Trump over disagreements on trade policy further roiled markets.
Refiners Hengyuan Refining Co Bhd, Petron Malaysia Refining & Marketing Bhd and Petronas Dagangan Bhd fell RM1 to RM9.18, 70 sen to RM9.03, and 52 sen to RM24.66, respectively. Petron’s share price, which has dropped by more than 30% this year, is now at its lowest since last September.
Hengyuan’s share price plunged almost 10%. Notably, the counter was one of the best-performing stocks last year but has lost more than 40% year-to-date.
There was also a heavy selldown in counters such as Sapura Energy Bhd , UMW Oil & Gas Corp Bhd and Hibiscus Petroleum Bhd .
Nestle (M) Bhd and manufacturers such as KESM Industries Bhd , Top Glove Corp Bhd and Kossan Rubber Industries Bhd were also among the top losers.
The local bourse was broadly lower, with the benchmark FBM KLCI losing 10.47 points or 0.57% to 1,837.9.
Yesterday’s loss marked six trading days of declines when the local market hit the highest level since August 2017 at 1871.46 points, although on a year-to-date basis, the FBM KLCI is still up by 2.3%.
Traders said both local institutions and foreign investors turned net sellers yesterday, adding more pressure to the overall weak sentiment in the market.
Regional markets were also down, with Hong Kong’s Hang Seng index falling 1% to 30,196.92 points, while the China Enterprises Index lost 1.1% to 12,180.29.
European markets opened lower, while at press time, US stock futures pointed to a weak Wall Street opening.
Inter-Pacific Securities research head Pong Teng Siew expects the local bourse to trade range-bound this month and the next on external uncertainties, as well as the impending general election.
“The month of March is expected to be volatile. Any recovery in the market would be short-lived, especially at this period of uncertainties of the US’ planned tariffs, and the weakness in the recent quarterly corporate results doesn’t help with the market downturn,” he told StarBiz.
Pong added that markets were still adjusting to the winding-down of the US Federal Reserve’s (Fed) bond purchasing programme.
The Fed is expected to shed US$2 trillion–US$3 trillion of securities holdings over the next five years as part of its balance sheet normalisation strategy.