Thursday, November 24, 2011

Asian markets continue to slide

KUALA LUMPUR (Nov 24): Asian markets continued to retreat on Thursday as weaker data from the US, Europe as well as China fuelled fears that the global economy was heading for a recession, compounding already jittery investor sentiment.

The FBM KLCI fell 2.83 points to 1,430.34 at 10am, weighed by losses at select blue chips.

Losers led gainers by 248 to 144, while 171 counters traded unchanged. Volume was 318.72 million shares valued at RM121.5 million.

Asian shares fell on Thursday and the euro struggled close to a seven-week low to the dollar after a botched German bond sale raised alarm that Europe's ever-worsening sovereign debt crisis is starting to affect even the continent's economic powerhouse, according to Reuters.

Germany's bond sale on Wednesday was the least successful since the launch of the euro, raising concern about the price Berlin may pay for its role as paymaster to a region racked by a crisis that has toppled governments in Greece and Italy, it said.

At the regional markets, Japan's Nikkei 225 fell 1.51% to 8,189.33, Hong Kong's Hang Seng Index lost 0.79% to 17,722.79, the Shanghai Composite Index was down 0.88% to 2,374.10, Singapore's Straits Times Index shed 0.20% to 2,671.27, Taiwan's Taiex was flat at 6,806.52 while South Korea's Kospi gained 0.27% to 1,787.89.

Maybank Investment Bank Bhd head of retail research and chief chartist Lee Cheng Hooi in a note to clients on Thursday said that due to the US markets' very poor tone last night, there could be another downward day for the local index.

Persistent liquidation would take place today, and the local bourse could remain very weak, as the tempestuous global downturn will persist.

'The global markets have into a 'Risk Off' stage again. This means that the US dollar will rise against the Euro, emerging currencies and commodities, whilst equity markets will be grossly out of favour.

'Local funds may think it is wise to 'hold' the FBM KLCI index at these lofty levels despite the global volatility. We believe that it would be deemed as investment folly to do so. Sell on all 'dead cat bounces' and step aside for now,' he said.

On Bursa Malaysia, BAT was the top loser at mid-morning and fell 52 sen to RM46.98; KLK lost 20 sen to RM21.18, KNM fell 10 sen to RM1.02, UMW nine sen to RM6.48, PLB 8.5 sen to 86.5 sen, MISC eight sen to RM6.12, while IJM PLANTATION []s, CBIP, Parkson and Maybulk fell seven sen each to RM2.63, RM3.97, RM5.58 and RM1.59 respectively.

Sumatec was the most actively traded counter with 17.2 million shares done. The stock fell half a sen to 23.5 sen.

Other actives included Karambunai, KNM, MBF Holdings warrants, DPS Resources and TMS.

Gainers included Batu Kawan, Nestle, CI Holdings, Tan Chong, AIC, Asas and HLFG.

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