Monday, September 12, 2011

KLCI falls the most in one month

KUALA LUMPUR: The FBM KLCI fell the most in a month on Monday, Sept 12 as global markets tumbled, spooked by worries of an absence in a permanent solution to the Euro zone and mounting fears of a Greek default.

Compounding investors' worries was the lack of detail on steps to boost the struggling economies from a meeting of the Group of Seven finance chiefs over the weekend, while German politicians were increasingly talking about a potential Greek default, according to Reuters.

The 30-stock index fell 1.56% or 22.86 points to 1,446.26, the steepest single day loss since Aug 9, weighed by losses including at banking and key blue chip stocks,

Market breadth was negative with 597 losers and 120 gainers, while 197 counters traded unchanged. Volume was 659.78 million shares valued at RM1.17 billion.

Of the 30 stocks on the FBM KLCI, 29 fell and one traded unchanged.

Among the losers, HLFG lost 34 sen to RM11.18, RHB Capital 21 sen to RM8.26, Hong Leong Bank 20 sen to RM12, Public Bank 12 sen to RM12.88, CIMB 10 sen to RM7.06, Maybank and AMMB eight sen each to RM8.61 and RM6.26, while Affin and AFG fell six sen each to RM2.79 and RM3.45.

Other major losers included BAT, PPB, Genting, DiGi, Batu Kawan, Top Glove and APM Automotive.

At the regional markets, Hong Kong's Hang Seng Index fell 4.21% to 19,030.54, Australia's S&P/ASX 200 Index lost 3.56% to 4,125.10 and Singapore's Straits Times Index was down 2.89% to 2,743.58.

Meanwhile, the China, Taiwan and South Korean markets were closed for the mid-autumn public holiday.

Strategists at the Royal Bank of Scotland in a note Sept 12 said a G7 statement over the weekend emphasised the current commitments from policy makers rather than hinting at any new imminent additional policy support.

It said this was disconcerting at a time that Europe was facing a complete coordination failure in front of its most severe financial and political crisis in modern times.

They said the fact that Greece did not default this weekend (as had been considered a possibility) was unlikely to provide even a short term fillip to markets that were focused on the broader issue of sovereigns and banks across the euro area.

'We believe markets will continue deteriorating until a concerted global response takes place.

'In this context, market participants will scrutinise any policy makers' statement to gauge the appetite for such response,' they said.


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