Profit-taking, weak petrochemical stocks drag Bursa lower

KUALA LUMPUR: Bursa Malaysia's stock market closed lower on Wednesday, affected by profit-taking and declining sentiment towards petrochemical stocks due to falling oil prices, according to an analyst. At 5pm, the FTSE Bursa Malaysia KLCI index fell 7.07 points, or 0.42 percent, to 1,676.43 from the previous day's close of 1,683.50.

The benchmark index opened 1.31 points lower at 1,682.19 and fluctuated between 1,675.15 and 1,685.37 throughout the day. Market breadth was almost even, with more stocks losing value than gaining value - 549 to 519. A total of 577 counters remained unchanged, 1,226 were untraded, and 27 were suspended. Trading volume decreased to 3.20 billion units, valued at RM2.99 billion, compared to 3.57 billion units, valued at RM3.15 billion the previous day.

Mohd Sedek Jantan, director of investment strategy and country economist at IPPFA Sdn Bhd, noted that crude oil prices fell after US President Donald Trump reported positive talks between Iran and the US at the United Nations, which reduced the geopolitical risk premium in oil prices. He also mentioned that investors remain cautious ahead of the anticipated meeting between Trump and Chinese President Xi Jinping, as the outcome could significantly impact global trade and economic growth expectations.

The mixture of profit-taking and lower energy prices kept the index under pressure, although investors continued to focus on geopolitical events and the direction of oil prices, according to Mohd Sedek. Kenneth Leong, head of research at Berjaya Research Sdn Bhd, stated that the market index is expected to stay range-bound in the near future as investors await more information on developments in the Middle East.