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KUALA LUMPUR (Jan 4): The FBM KLCI fell 26.64 points or 1.51% to 1,602.57 on the first trading day of 2021 amid strong selling at glove counters.
Rakuten Trade Sdn Bhd’s head of research, Kenny Yee, attributed this to the resumption of regulated short selling in Bursa Malaysia with effect from today.
The exchange had imposed a ban on short selling of shares since March 24 of last year during the global market crash.
“I think the market volatility will continue until the glove meter volatility subsides. We believe that there will be buy support when the index falls below 1,600, ”Yee told theedgemarkets.com.
In the broader market, 934 meters closed lower versus 360 that rose, while another 331 were unchanged. The total volume of shares was 7.42 billion shares worth RM5.89 billion.
Glove makers were among the main losers, with Top Glove Corp Bhd plummeting 62 sen or 10.13% to RM5.50. The counter, which saw 347.86 million shares changing hands, was the most traded stock today.
Hartalega Holdings Bhd fell RM1.66 or 13.67% to RM10.48, making it the main loser in terms of value. Supermax Corp Bhd fell 50 sen or 8.32% to RM5.51.
In the rest of Asia, equity markets mostly started the new year on an optimistic note. Reuters reported that Chinese stocks extended their rally after a survey pointing to a continued recovery in the world’s second-largest economy bolstered investor sentiment.
The Shanghai Composite Index rose 0.86% to 3,502.96, the Shenzhen Component Index gained 2.47% to 14,827.47 and the Hong Kong Hang Seng Index advanced 0.89% to 27,472.81 .
However, Tokyo’s Nikkei 225 fell 0.68% to 27,258.38 after the government said it could declare a state of emergency due to the increase in coronavirus cases.
The Asian forex market continued to gain momentum on the first trading day of 2021. The ringgit was up 0.31% to 4.0080 against the US dollar at 5:00 pm, the strongest level since June 2018.
“The ringgit is expected to strengthen further in the first week of 2021 as [US] The dollar is expected to amplify its widespread weakness thanks to positive global economic sentiment, strong crude oil prices and the global rollout of Covid-19 vaccination, ”Kenanga Research said in a note today.
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