Market Close KLCI flat as crude oil fizzles

by **Cals** Thu 18 Feb 2016, 02:06

Market Close

[size=28]KLCI flat as crude oil fizzles

By Ahmad Naqib Idris / theedgemarkets.com | February 17, 2016 : 5:40 PM MYT

KUALA LUMPUR (Feb 17): The FBM KLCI fell 0.67 point on profit taking after major crude oil producers' supply freeze announcement failed to support prices of the commodity.

At 5pm, the KLCI closed at 1,664.32 points after reaching an intraday high of 1,669.02 in volatile trade. Yesterday, the KLCI added 15.03 points to close at 1,664.99.

Today, Reuters reported that oil prices fell, reversing gains earlier in the session, on signs that Iran will not join in a deal between Saudi Arabia, Russia and other producers to freeze oil output at January levels, keeping the current oversupply in place.

Brent crude was down 31 US cents at US$31.87 a barrel by 0739 GMT, after settling down US$1.21 in the previous session. It had climbed to US$32.83 a barrel in early trade on Wednesday. US crude fell 25 US cents to US$28.79 a barrel, after trading for much of the Asian session above US$29 a barrel. It ended the last session down 40 US cents.

In Malaysia, Areca Capital Sdn Bhd chief executive officer Danny Wong told theedgemarkets.com the KLCI lost its upward momentum as the oil supply freeze announcement was not expected be effective in addressing the slump in prices.

"The market was excited yesterday after the announcement on the freeze in oil production as it could have meant a potential rebound in oil prices. However, a freeze in output, at the existing record high levels, is not very helpful as the existing supply level still outpaces demand.

"Despite that, this shows that Saudi Arabia and Russia, the world's largest crude oil producers, are concerned [about] the slump in prices. It is a key indicator that they are working to address the problem," said Wong.

Bursa Malaysia saw 1.75 billion shares worth RM1.62 billion traded. Gainers edge out decliners at 440 against 402.

United Plantations Bhd led decliners, while Genting Plantations Bhd led gainers. The top-active stock was Vivocom International Holdings Bhd.

Asian share markets were down. Japan's Nikkei 225 fell 1.36%, Hong Kong's Hang Seng declined 1.03% while South Korea's Kospi closed 0.23% lower.

Reuters reported that Asian shares slipped on Wednesday after two sessions of solid gains as markets waited for minutes of the Federal Reserve's last meeting to judge the balance of opinion among policymakers on the prospect of further rate hikes.
In Malaysia tomorrow, Bank Negara Malaysia will announce the country's fourth quarter and full year gross domestic product numbers for 2015. [/size]