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KUALA LUMPUR (Oct 21): FBM KLCI finished in negative territory for the second day in a row, dragged down by glove stocks that dominated Bursa Malaysia’s top losers.
At 5:00 p.m., the benchmark closed 18.57 points or 1.23% lower at 1,492.4. Market width remained largely negative with 754 losers versus 374 winners. Meanwhile, the trading momentum was quite active with 8.48 billion shares traded for RM5.95 billion.
Malacca Securities Sdn Bhd’s head of research, Loui Low, told The Edge that today’s drop is likely due to a mix of negative factors, such as market concerns about early elections and speculation about what will be announced during the next Budget 2021 in Parliament in two weeks. ‘ time.
The big four glove stocks – Hartalega Holdings Bhd, Supermax Corp Bhd and its structured warrants, Top Glove Corp Bhd and Kossan Rubber Industries Bhd – dominated the list of Bursa’s top losers today.
At the close of the market, Hartalega fell RM1.20 or 6.3% to RM17.84, while Supermax closed 86 sen or 8.3% lower at RM9.50. Top Glove closed 60 sen or 6.33% lower at RM8.88 while Kossan was down 81 sen or 9.96% at RM7.32.
Hong Leong IB Research said that despite closing above the critical 200D SMA support (now at 1.497) and the main trend line of support from the 1.474 low, KLCI is still engaged in a tug of war between the bulls and Bearish amid mounting headwinds ahead of the US presidential elections and a resurgence of COVID-19 infections globally.
“Furthermore, more targeted lockdowns amid an increase in local COVID-19 broadcasts in Malaysia may dampen our expectations for an economic recovery and corporate earnings in 2H20,” he said in a note today.
Meanwhile, Reuters said Asian equities and US equity futures rose on Wednesday as renewed hopes for a new round of US stimulus drew money from government debt into equities.
Japan’s Nikkei 225 gained 0.31%, while South Korea’s Kospi closed 0.53% higher. In China, the Hang Seng rose 0.75% while the Shanghai Composite Index fell 0.09%.
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