KUALA LUMPUR (Aug 3): A two-tier market emerged on Bursa Malaysia. While the FBM KLCI registered the biggest single-day percentage drop in seven weeks, the FBM ACE index surged 7.52% or 641.94 points to 9,176.82 points.

Trading activities remained robust on the local bourse with the volume swelling to a record high of 13.13 billion shares.

The benchmark index shed 1.94% or 31.14 points to 1,572.61 points — the biggest single-day percentage drop since June 15, when the index slid by 3.05% (see chart).

Of the 29 indices present on Bursa Malaysia, only seven posted gains today. Among the seven, Healthcare, Technology and the FBM ACE indices posted the strongest gains.

The FBM ACE index finished 7.52% or 641.94 points higher at 9,176.82 points. Meanwhile, the Healthcare index finished 4.37% or 171.78 points higher at 4,099.05 points, whereas the Technology index was up by 4.9% or 2.5 points to 53.53 points.

Top Glove Corp Bhd, Hartalega Holdings Bhd and KLCC Stapled Group were the only three component stocks that ended the day in the green. Top Glove soared 3.86% or RM1 to a new peak of RM26.88, valuing it at some RM72.69 billion. Meanwhile, Hartalega gained 1.08% or 22 sen to RM20.50, giving it a market value of RM70.27 billion. KLCC Stapled Group went up 1.28% or 10 sen to RM7.90, valuing it at some RM14.26 billion.

Banking stocks succumbed to selling pressure. In particular, Hong Leong Bank Bhd shed 4.67% or 70 sen to RM14.30, CIMB Group Holdings Bhd slid 3.62% or 13 sen to RM3.46, while Public Bank Bhd dropped 2.59% or 44 sen to RM16.56. Malayan Banking Bhd lost 2.22% or 17 sen to RM7.50, and RHB Bank Bhd fell nearly 2% or 10 sen to RM4.92.

Malacca Securities head of research Loui Low opined that it was a two-tier market with pandemic-related stocks performing well while stocks in other sectors slipped into the negative territory.

"The rising Covid-19 cases abroad and local (mildly increasing) could be a concern as this will delay the recovery should there be more lockdowns in more countries," Low commented.

Furthermore, Low pointed out the concern of the possible scenario that would pan out after the end of the loan moratorium period at end-September dampened market sentiment.

Areca Capital chief executive officer Danny Wong observed that there might be some programmed selling or portfolio adjustments by institutional investors that pulled down the FBM KLCI.

Rakuten Trade Research vice president Vincent Lau viewed that external developments could also have played a role in today's decline.

"Today's decline could likely be due to external developments such as the lack of agreement over a potential stimulus measure in the US, the US Dollar declining and the recent flare-up in US-China trade tensions," said Lau.