KLCI slips below 1,650 as ECB decision sparks disappointment

KUALA LUMPUR: The FBM KLCI slipped below the 50-day simple moving average on Friday following news that the European Central Bank was holding its interest rate steady.

Asian markets were similarly in the red on the overnight news that the ECB was keeping its policy rate at -0.4% althogh it signaled that it was ready to make cuts in September as well as restart its bond-buying programme.

They key regional markets fell in unison led by Japan’s Nikkei Index falling 0.6%. The Shanghai Composite Index was down 0.2%, CSI300 Index slipped 0.1%, Hong Kong’s Hang Seng Index dropped 0.45%, and South Korea’s Kospi Index shed 0.5%.

At 12.30pm the FBM KLCI was down 6.9 points to 1,649.68. Trading volume on the stock exchange was 1.4 billion shares valued at RM905.96mil. There were 437 decliners versus 253 gainers and 369 counters unchanged.

An overwhelming number of stocks on the benchmark index were negative although a bright spot came in the form of the Genting counters.

News that the entertainment and hospitality group had restarted discussions with Fox over the fate of its theme park collaboration, Genting shares jumped 10 sen to RM7 while Genting Malaysia climbed 19 sen to RM3.86.

Only World Group spiked 13 sen to 69 sen on news of the renewed talks as its food and entertainment outlets stood to benefit from the spillover effect of the theme park.

Other stocks seeing strong price gains include G3 jumping 61 sen to RM3.12 and MSM climbing 11 sen to RM1.28.

Meanwhile, oil prices dropped as a Reuters poll showed global economic growth was likely to slow further although tensions in the Middle East helped to mitigate losses.

US crude fell 17 cents to US$56.19 a barrel and Brent crude dropped seven cents to US$63.46 a barrel.

In currencies, the ringgit slipped 0.1% against the US dollar to 4.1200 but rose 0.1% against the pound sterling to 5.1283 and 0.1% against the Singapore dollar at 3.0112.

Source: TheStar