KUALA LUMPUR – Bursa Malaysia retreated from its gains yesterday to open lower today due to profit-taking activities, as investors were seen taking cue from the overnight decline on Wall Street, a dealer said.
At 9.15am, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) contracted 4.2 points to 1,565.90 from 1,570.10 at yesterday’s close, after opening 5.80 points lower at 1,564.30.
Market breadth was negative with losers leading gainers 325 to 122, while 233 counters were unchanged, 1,538 untraded and 36 others suspended.
Turnover stood at 354.5 million units worth RM167.08 million.
Malacca Securities Sdn Bhd said profit-taking activities may take shape amid mounting concerns over the pace of interest-rate hikes in the US in 2022 and renewed volatility on Wall Street overnight.
On the home front, investors remain cautious as now the attention has shifted towards the release of the fourth quarter (Q4) of 2021 gross domestic product (GDP) data later today in order to assess the pace of economic recovery.
“Recovery-theme stocks may also continue to be boosted ahead of the release of Q4 GDP data,” it said in a note.
On a separate development, the ringgit opened lower against the US dollar today as negative sentiment clouded demand for the local currency, an analyst said.
At 9am, the local currency stood at 4.1870/1900 versus the greenback from yesterday’s close of 4.1825/1840.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the ringgit traded easier in the early session due to the strengthening US dollar Index which gained 0.19% to 95.673.
“The US Consumer Price Index for January surprised on the upside to 7.5% year-on-year, the highest in nearly four decades.
“Following this, investors are betting that the US Federal Reserve (Fed) would raise the Fed Fund Rate by a half-percentage point in March,” he said.
Consequently, the two-year US Treasury yields shot up 22 basis points to 1.58% as the short-dated securities are typically sensitive to the change in monetary policy, he said.
However, Mohd Afzanizam said the currency market has already priced in the eventual more hawkish stance by the US Fed.
“Hence, volatility is something that we cannot rule out in the forex market. As such, dollar to ringgit could range between RM4.18 and RM4.19 against the greenback today,” he said.
Meanwhile, the ringgit was traded higher against a basket of other major currencies.
It rose vis-a-vis the Japanese yen to 3.6070/6099 from yesterday’s close of 3.6118/6134 and improved against the British pound to 5.6696/6737 from 5.6761/6781.
The local currency appreciated versus the euro to 4.7728/7762 from 4.7865/7882 yesterday and strengthened against the Singapore dollar to 3.1107/1134 from 3.1173/1187. – Bernama, February 11, 2022
