KUALA LUMPUR: The burst of optimism that carried Wall Street higher on Friday was lost on Bursa Malaysia as the geopolitical risk from the Middle East conflict re-escalated over the weekend.
Amid accusations from both sides of breaches to the ceasefire agreement, Iran shut down the Strait of Hormuz in retaliation for the US blockade of its ports.
The FBM KLCI fell 1.71 points to 1,693.50, keeping to its sideways pattern as traders awaited new developments in the ongoing saga.
"The renewed disruption to a key global oil transit route has reversed last week’s risk-on sentiment, lifting crude oil prices and dampening investor confidence. This shift is likely to weigh on overall market sentiment, particularly after the strong rally seen in global equities previously," said Apex Securities.
Brent crude futures, which had dropped to below US$90 a barrel in Friday's session, was seen hovering around US$95 a barrel on Monday.
The research firm noted the rebound in oil prices could lend support to energy-related counters, while sectors sensitive to higher input costs, including consumer and transport names, could face renewed pressure.
At the same time, heightened uncertainty may trigger a rotation back into defensive sectors and profit-taking in recent outperformers.
Actively traded stocks included Pharmaniaga
, flat at 24 sen, AirAsia X down one sen to Rm1.28 and Aizo up 0.5 sen to four sen.
In regional markets, Japan's Nikkei rose 0.77% to 58,913 on residual momentum from the previous week's strong tech rally. South Korea's Kospi rose 0.97% to 6,251.
