KUALA LUMPUR: Bursa Malaysia drifted lower on Thursday despite the overnight surge in US stocks as negotiations in the Middle East may have hit a wall less than a day after a ceasefire deal was struck.
Markets are back on edge after Iran accused Israel of violating the the terms of the ceasefire by launching fresh strikes on Lebanon, threatening to derail negotiations.
On the FBM KLCI, stocks fell over 10 points to 1,685.49 as prices retraced lower in light of the latest developments.
Apex Research said in a note that markets are expected to remains cuatious as the fragile ceasefire between the US and Iran faces renewed uncertainty.
It said in its technical outlook that following the previous day's strong rebound, further upside movement on the FBM KLCI may signal a return of constructive momentum and signal a resurgence of buying interest.
"Immediate downside risk now pivots to the next support at 1,665, where a break below this level would reinforce bearish momentum and indicate sustained downward pressure in the near term."
Brent crude futures, meanwhile, crept higher by about 3% to US$97.60 a barrel after falling yesterday to the US$95 level as the status of oil shipments through the Strait of Hormuz remained uncertain, falling short of the parties reaching an agreement over the details of the ceasefire.
On Malaysia's blue-chip index, stocks were a sea of red as investors returned to a defensive posture. Nestle fell RM1.80 to RM99.20, Maybank shed 10 sen to RM11.22 and IHH slid eight sen to RM8.73.
Hibiscus Petroleum jumped nine sen sen to RM2.03 while AirAsia X
retreated three sen to RM1.22 and Capital A dropped one sen to 45 sen.
