FBM KLCI closes below 1,800 amid debt level concerns

PETALING JAYA: The FBM KLCI tumbled 1.58% or 28.59 points to 1,775.66 points today, after a mixed performance in the US market overnight, with the Malaysian bourse bogged down by negative sentiment over the countryt's high debt.
The index traded within a range of 41.72 points, with a day high of 1,809.90 and a day low of 1,768.18.
Trading volume shrank to 2.69 billion shares worth RM3.34 billion from Wednesday's 2.69 billion shares worth RM3.34 billion. Market breadth was negative with 235 gainers to 752 losers.
Actively traded stocks included Sapura Energy, My E.G. Services, Malayan Banking, Eduspec Holdings, Priceworth International, Hibiscus Petroleum, Malaysian Resources Corp and YTL Corp.
Top losers included British American Tobacco (M), Nestle (M), Ajinomoto (M), Public Bank and Allianz Malaysia.
One analyst told SunBiz: "1,800 is just another level", when asked to comment on the breach of 1,800 points, which is seen as a psychological support level.
"Now that it is below 1,800, is it important? I don't think so. When it gets closer to 1,700, do you think 1,700 is also a psychological level? It is a psychological level, but whether it will have a significant impact ... people are more concerned about the bigger picture," said the analyst.
He said uncertainties brought on by national debt issues, review of the construction sector and toll concessions caused panic.
"You don't have solutions, investors take it negatively. Most likely they will stay on the sidelines, so they will sell."
HLIB Research expects support to be anchored around 1,800 points, followed by 1,760. Should there be any rebound, the upside is envisaged around 1,830-1,840.
"We believe there could be some relief rebound on the FBM KLCI, tracking the slight gains on Wall Street. Nevertheless, upside could be limited as traders may still be focusing on the national debt issues and anticipate the next action plan by Pakatan Harapan to reduce the debt status."
Moreover, 1MDB news flow and the expected review of construction mega projects and toll concessions may dampen sentiment, it added.