FX.co ★ Malaysia Bourse May Extend Thursday's Losses

The Malaysian stock market has fluctuated between gains and losses over the past four trading days following a three-day decline where it dropped over 15 points or 1 percent. Currently, the Kuala Lumpur Composite Index (KLCI) is positioned just below the 1,625-point mark, with indications that the losses may intensify on Friday.

Globally, there is a negative outlook for Asian markets driven by concerns over an economic slowdown. Both European and U.S. markets ended sharply lower, and it is anticipated that Asian markets will follow the same trend.

On Thursday, the KLCI ended slightly down as losses in the plantation sector were balanced by gains in the financial sector. The index dipped 1.32 points or 0.08 percent to close at 1,624.25, after oscillating between 1,621.44 and 1,626.35 during the day.

In terms of active stocks, Celcomdigi fell by 1.32 percent, Genting dropped by 1.90 percent, and Genting Malaysia decreased by 1.15 percent. Conversely, Hong Leong Bank increased by 0.52 percent and Hong Leong Financial advanced by 0.93 percent. Other notable movements include IHH Healthcare rising by 0.32 percent and Kuala Lumpur Kepong gaining 0.19 percent, while IOI Corporation and Maxis slid by 0.79 percent and 1.42 percent, respectively. Public Bank saw a rise of 1.19 percent, while notable decliners included Sunway, which plummeted by 3.26 percent, and Petronas Dagangan, which fell by 2.82 percent. Axiata, CIMB Group, and Telekom Malaysia remained unchanged.

The trend from Wall Street indicates a broadly negative sentiment as major averages, which opened slightly higher on Thursday, quickly moved downward to finish significantly lower. The Dow Jones Industrial Average plunged 494.82 points or 1.21 percent to close at 40,347.97. The NASDAQ composite dropped 405.26 points or 2.30 percent to 17,194.14, and the S&P 500 fell 75.62 points or 1.37 percent to close at 5,446.68.

The precipitous decline in U.S. markets was fueled by disappointing economic data, sparking apprehension regarding the U.S. economic outlook and overshadowing positive sentiments about a possible near-term interest rate cut by the Federal Reserve. Specifically, the Institute for Supply Management reported that U.S. manufacturing activity unexpectedly contracted at a faster pace in July. Additionally, the Labor Department revealed that initial claims for unemployment benefits hit their highest level in almost a year last week.

On the commodities front, oil futures closed lower on Thursday due to concerns stemming from the disappointing economic data and its impact on oil demand. West Texas Intermediate crude oil futures for September dropped by $1.60 or about 2.05 percent, settling at $76.31 per barrel.