KLCI extends loss, falls 0.92% to stay firmly rooted below 1,500 level as regional markets stumble on rising US virus cases

TheEdge Thu, Jun 25, 2020 10:28am - 8 months ago

KUALA LUMPUR (June 25): The FBM KLCI extended its losses in the mid-morning and was down 0.92% to stay firmly rooted below the 1,500-point level, tracking the drop in regional markets following a surge in virus cases in several US states.

At 10am, the KLCI had lost 13.74 points to 1,488.89.

Market breadth turned negative with 516 losers and 141 gainers, while 339 counters traded unchanged. Trading volume was 1.19 billion shares valued at RM527.19 million.

The top losers included Nestle (Malaysia) Bhd, Heineken Malaysia Bhd, Petronas Dagangan Bhd, PPB Group Bhd, Malaysia Airports Holdings Bhd, Hong Leong Financial Group Bhd and Tenaga Nasional Bhd.

The actives included NetX Holdings Bhd, AT Systemization Bhd, Kanger International Bhd, Iris Corp Bhd, KNM Group Bhd, Minetech Resources Bhd, Protasco Bhd, Green Packet Bhd and Vivocom Intl Holdings Bhd.

The gainers included Milux Corp Bhd, Carlsberg Brewery Malaysia Bhd, SHL Consolidated Bhd, Malaysian Pacific Industries Bhd, QL Resources Bhd and VisDynamics Holdings Bhd.

Bloomberg said Asian stocks dropped after a tumble on Wall Street, where worries about a surge in virus cases in multiple US states spurred a flight from riskier assets.

The US dollar extended yesterday’s gains, it reported.

Hong Leong Investment Bank Research said barring a successful reclaim above the key 200-day simple moving average (SMA) at 1,513 points, the odds are still favour of more consolidation ahead.

It said a decisive breakdown of the 1,482-1,490 support level would signal that a deeper correction is in place, compounded by fluidity of the local political scene and the expiry of the short-selling ban on June 30, coupled with second-wave Covid-19 infection fears.

“Nevertheless, hope for mid-year window dressing is likely to cushion the sell-off with lower support at the 1,440-1,460 level,” it said.

As for stock selection, the research house said airlines and tourism-related stocks that had been climbing amid reopening optimism may witness selling pressure, while appetite for glove companies may come back amid the resurgence of Covid-19 cases, with both the European Union and US governments considering gloves as “national security” stockpiles until an effective cure or vaccine is found and ready for mass commercial production (which could be nine to twelve months away).

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