At 12.30pm, the key index was down 9.11 points to 1,574.81 following a sharp early-morning plunge triggered by the government's implementation of a nationwide movement control order starting Thursday.
Market breadth on Bursa Malaysia was overwhelmingly negative wtih 928 decliners versus 157 gainers.
The Statistics Department announced at noon that the country's economy shrank 0.5% year-on-year in 1Q, which came within most analyst expectations of a slight contraction before a positive growth trend ensued in subsequent quarters.
Malacca Securities Research predicts that energy and plantation counters may see buying interest given the uptrend in commodities prices, particularly CPO and oil prices.
"Also, some of the essential consumer stocks as well as lockdown beneficiaries such as the plastic packaging industry may bode well throughout this period of time," it said.
However, the blue-chip FBM KLCI saw broad-based selling.
Among the top losers, Petronas Chemicals fell 12 sen to RM8.13, Sime Darby Plantation dropped 10 sen to RM4.67, IHH shaved seven sen to RM5.59, and Hong Leong Bank slid 14 sen to RM17.44.
While Top Glove managed to eke out a one sen advance to RM5.17, Hartalega dropped 16 sen to RM9.42 and Supermax stood unchanged at RM4.63.
Top actives were PHB unchanged at two sen, Focus flat at eight sen and Fintec down 0.5 sen to four sen.
Regionally, equities markets were awash with red as US inflation data triggered worries over potential interest rate increases.
Japan's Nikkei slumped 3% and South Korea's Kospi dropped 1.3%.
China's composite index dropped 0.3% while Hong Kong's Hang Seng skidded 2.1%. In Australia, the ASX200 was down 1.1%.