KLCI opens to recession jitters, region resumes fall

KUALA LUMPUR: The local market opened on shaky ground on Thursday as around the world, investors continued to sell down riskier assets amid fears of a looming recession.

At 9.10am, the FBM KLCI was down 0.46 points to 1,642.27. Trading volume was 104.78 million shares valued at RM48.32mil. There were 122 decliners versus 79 gainers and 205 counters unchanged.

After a week of heavy losses, the local index looked undecided over its direction in early trade despite a negative performance on Wall Street overnight.

The major US indices fell as the 10-year US Treasury yields slipped to 15-month lows at 2.35%.

Kenanga research does not discount the possibility of a short technical rebound on the FBM KLCI despite the index’s bearish outlook.

“Should a technical rebound happen, we look towards 1,660 (R1) and 1,700 (R2) as resistance levels. Conversely, support levels can be identified at 1,630 (S1) and 1,615 (S2),” it said in its morning note.

Meanwhile, other Asian markets also opened to recession fears as Japan’s Nikkei fell 1.7% and South Korea’s Kospi dropped 1%. Australia’s ASX200 held relatively steady at minus 0.1%.

Some KLCI counters seeing notable price action were Public Bank losing 10 sen to RM23.30 while Petronas Chemicals added eight sen to RM9.13 and Genting gained six sen to RM6.67.

Counters seeing heavy interest were Bumi Armada trading unchanged at 18.5 sen, Velesto down 0.5 sen to 28 sen and Sapura Energy shedding 0.5 sen to 32.5 sen.

Oil prices also came under pressure amid the economic uncertainty and rising US stocks. Brent crude fell 20 cent sto US$67.63 a barrel and US crude slipped 23 cents to US$59.18 a barrel.

Source : TheStar