The Kuala Lumpur Composite Index fell for a second day, losing 2.87 points, or 0.3 per cent, to close at 876.80, the lowest level since January 23. Thirty-one stocks dropped and 30 rose on the 100-member measure.
In the market, 289 million shares changed hands, lower than the three-month daily average of 490 million shares. February index futures gained 0.8 per cent to 876.00.
“Short-term investors are taking a very cautious approach and sitting on the sidelines ahead of Friday’s US jobs report,” a dealer said.
“Corporate results are also due over the next few days and this will dictate the direction of the market,” he added.
Dealers say political woes in Perak created some jitters among investors, causing a minor sell-off at the end of trade.
Malaysia’s coalition government announced after the market close that it had seized control of Perak, which the opposition alliance had held by a narrow margin.
Deputy Prime Minister Datuk Seri Najib Tun Razak said the state government which was voted in last March had collapsed with the defection of four legislators. One was to join the Barisan Nasional coalition government and the others would be independent.
Malayan Banking Bhd, Malaysia’s largest bank, slid 5 sen, or 0.9 per cent, to RM5.25. Hong Leong Bank Bhd dropped 5 sen, or 1 per cent, to RM5.20. The two banks’ ratings were lowered at UBS AG, which cited the risks of impairments and potential capital-raising. Malayan Banking was cut to “sell” from “neutral” while Hong Leong Bank was cut to “neutral” from “buy,” UBS said in a report.
KNM Group Bhd advanced 0.5 sen, or 1.2 per cent, to 44 sen. The Employees Provident Fund, Malaysia’s largest pension fund, bought 2 million shares in the oil and gas services provider, lifting its stake to 8.7 per cent, a stock exchange filing showed. KNM was the second most active stock with 18.8 million shares traded.
MISC Bhd, a Malaysian shipping operator, dropped for a second day, losing 20 sen, or 2.3 per cent, to RM8.50, the most since December 23, after HwangDBS Vickers Research Sdn Bhd cut its rating on the stock to “fully valued” from “hold,” saying the stock “has not priced in potentially weaker tanker rates in the near term. The drop in MISC shares accounted for almost half of the Composite Index’s decline.
Metronic Global Bhd rose 0.5 sen, or 14 per cent, to 4 sen, set for the biggest gain since January 2. The computer systems developer said it signed an agreement to build and operate a water treatment plant in China’s Anhui province. Metronic said in a statement it will own 70 per cent of a joint venture that will sell treated water for 33 years. The joint venture company will spend RM12 million to build the plant, it said.
TM International Bhd, a Malaysian mobile phone operator, added 6 sen, or 2 per cent, to RM3.08, snapping a three-day, 8 per cent slide. Today’s gain is the most since January 16. Credit Suisse Group said investors should buy the shares as they “have been oversold as a result of fund flow.” - Agencies