Major selloff on Bursa as investors take profit


The FBM KLCI failed to maintain its position at the 1,400-point mark it achieved on Friday after taking a 31.39-point or 2.22% plunge yesterday to 1,381.73 points.

PETALING JAYA: A double whammy in the market sent the local bourse into a bloodbath as investors took profit from a spectacular two-day rally.

The market saw a major selloff yesterday amid fears over the impact of the steep plunge in US light crude oil prices to historic low around sub-zero level.

The FBM KLCI failed to maintain its position at the 1,400-point mark it achieved on Friday after taking a 31.39-point or 2.22% plunge yesterday to 1,381.73 points.

All the 30 components of the benchmark index declined, except for Maxis Bhd, which rose 1.32% to RM5.39.

Investors were beginning to take profit from their holdings in rubber glove counters, which have been enjoying steady growth in share prices as they were regarded safe-haven stocks during the coronavirus (Covid-19) pandemic.

Market breadth was negative as Bursa Malaysia saw 827 decliners as compared to 198 advancers while 253 remain unchanged.

Oil and gas counters were all in a sea of red, with Velesto Energy Bhd leading the pack as the second-most actively traded counter. Plunging crude oil prices globally soured investment sentiment on local oil and gas companies.

Total turnover in terms of shares traded on Bursa Malaysia surged to 6.53 billion shares, valued at RM2.94bil.

Rakuten Trade Research vice-president Vincent Lau said, “The index has been trending upward quite a fair bit last week.

“Apart from the oil price slump today, we see some profit taking across the market, as consumer and glove counters were down today.”

Key Asian markets were also in the red, with Japan’s Nikkei down 2%,

Shanghai’s Composite Index 1% lower, Hong Kong’s Hang Seng dropping 2.4% and South Korea’s Kospi falling 1%.

US crude futures for May yesterday plunged 305% to close at -US$37.63 a barrel on rising concerns of declining storage as storage tanks in the US neared capacity.

Reuters reported that the May delivery of West Texas Intermediate contract expires at the end of trade yesterday, which is pushing investors to clear them from their books at any price.

June prices at US$22 per barrel point to some relief but the collapse highlighted intense disruptions globally as the Covid-19 pandemic and lockdowns paralyse the world economy, which augurs badly for a swift return to growth.

The S&P 500 closed 1.79% lower to 2,823.16 points, while Dow Jones Industrial Average ended the day with a 2.44% decline to 23,650.44 points.

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 1
Cxense type: free
User access status: 3

Bursa , selloff , Maxis , FBM KLCI ,

   

Did you find this article insightful?

Yes
No

100% readers found this article insightful

Next In Business News

Banks continue to extend repayment assistance
Ringgit slightly lower as greenback rises on safe haven demand
Kenanga lowers earnings forecast on Genting Malaysia amid further lockdowns
Foreign investors turn net buyers again on Bursa Malaysia
Quick take: Samaiden rises on power plant contract
Bank stocks fall on speculation over further OPR cut
Quick take: Kanger gains 3% on diversification into construction
Trading ideas: Top Glove, Kanger, Daya, Samaiden, MESB, Seacera
AmInvestment initiates 'buy' on Perak Transit on business model potential
Asia shares step back, await China economic update

Stories You'll Enjoy