Market Close KLCI ends first trading day of 2016 in the red

by **Cals** Mon 04 Jan 2016, 23:36

Market Close

[size=28]KLCI ends first trading day of 2016 in the red

By Gho Chee Yuan / theedgemarkets.com | January 4, 2016 : 5:43 PM MYT

KUALA LUMPUR (Jan 4): The bearish sentiments across key regional markets due to weaker China economic data, dragged the Malaysian stock market into the red in its first trading day of 2016.

At the end of trading hours, the FBM KLCI was down 39.14 points or 2.31% at 1653.37 points, its lowest point of the day, marking its second consecutive day of contraction. The key index fell 0.63 points or 0.03% to finish the last trading of 2015 at 1,692.51 points.

According to Mercury Securities' head of research Edmund Tham, the bearish performance in the local equity market was mainly due to the Chinese trading halt.

Reuters reported today that the Shanghai Shenzhen CSI 300 Index fell 7% to trigger the "circuit breaker" on the very first day that the trading suspension mechanism came into effect.

On the KLCI’s possible direction for Tuesday (Jan 5), Tham said it would depend on China’s stock market.

"If there is continued selling pressure (in the China stock market), then (the FBMKLCI) is likely to remain bearish," he told theedgemarkets.com over the phone.

The decline in selected bluechips stocks such as Petronas Dagangan Bhd ([You must be registered and logged in to see this image.] Valuation: 0.50, Fundamental: 2.10), Petronas Gas Bhd, Hong Leong Bank Bhd ( Valuation: 1.45, Fundamental: 2.00), Sime Darby Bhd ( Valuation: 1.40, Fundamental: 0.80) and PPB Group Bhd ( Valuation: 1.60, Fundamental: 2.30), which were among the top losers of the day, have also weighed down the performance of the key index.

Market breadth is negative, with 708 decliners versus 278 advancers; while 255 counters remained unchanged.

A total of 1.92 billion shares, worth RM1.734 billion, were done for the whole trading session.

The top losing counter was British American Tobacco Malaysia Bhd ([You must be registered and logged in to see this image.] Valuation: 1.50, Fundamental: 1.35), while the top gainer was United Plantations Bhd ( Valuation: 1.10, Fundamental: 1.95).

The most actively-traded stock of the day was Instacom Group Bhd ([You must be registered and logged in to see this image.] Valuation: 0.20, Fundamental: 1.95), with a trading volume of 85.77 million shares.

Over at the commodities market, oil prices rose today, as worsening relations between Saudi Arabia and Iran raised concerns about possible supply disruptions.

International traded Brent Crude index was up 0.67% at US$37.53 per barrel, while US Crude (also known as West Texas Intermediate, WTI) gained 0.76% at US$37.32 per barrel as at 3.07pm.

Meanwhile, the ringgit weakened against the US dollar. As at 3.35pm, the greenback gained 1.01% to quote at 4.3368 against the local note, compared to the closing price of 4.2933 on Dec 31, 2015.

On the regional front, China's Shanghai Composite Index tumbled 6.86% today, followed by Japan Nikkei 225's 3.06% decline; Hong Kong's Hang Seng index saw a 2.68% drop and South Korea's Kospi retreated 2.17%.

Reuters reported that Asian shares and currencies tumbled on the first day of trading in 2016, after China’s factory activity contracted and its central bank guided the yuan lower.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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