KUALA LUMPUR: The overnight plunge in US equities spilled over to Bursa Malaysia, which had already been shaky in recent days due to heightened investor caution.
At the start of trading, the FBM KLCI gapped down 4.06 points to 1,617.08, tracking the sharp sell-off in US markets after investors pulled out of the Magnificent 7, Wall Street's leading tech counters, following disappointing earnings from Tesla and Alphabet.
Following the fall below the 1,630 psychological level yesterday, the local key index in now looking to defend the 1,600 support, said Apex Securities Research in a note.
"Amidst the heightened volatility, we remain defensive, favouring the REIT and Utilities sector," it said.
As expected, the local tech sector was doused by the negative sentiment stemming from US markets, falling nearly 2% in early trade.
The Bursa Malaysia Technology Index dropped below the 50-day simple moving average as it returned to a six-week low with three-quarters of its component counters in the red.
Leading decliners included Unisem down nine sen to MR4, Vitrox falling six sen to RM4.09, Vstecs shedding 12 sen to MR3.96 and Frontken falling 11 sen to RM4.23.
The most heavily traded stocks on the market were Zentech up 0.5 sen to 1.5 sen, PDZ flat at six sen and JAKS unchanged at 17.5 sen.
In its worst trading session since October 2022, the tech-heavy Nasdaq index dove 3.64% to 17,342, erasing nearly a trillion dollars off its market capitalisation, while the S&P500 fell 2.31% to 5,427 and the Dow Jones dropped 1.25% to 39,853.
Moving forward, Apex Securities said investors will be keeping a close tab on the advance reading of US 2Q24 GDP data tonight alongside the ongoing flurry of corporate earnings releases.
