KUALA LUMPUR: The Malaysian stock market was hammered by the weak economic data and MSCI's move to reduce the weightage for blue chips, especially banking stocks on Friday.
The bad news sent the FBM KLCI to the lowest since Jan 21 this year, with selling pressure seen just at the start of trade.
At 12.30pm, the FBM KLCI was down 22.45 points or 1.36% to 1,626.53. Turnover was 1.03 billion shares valued at RMRM1.13bil. The broader market was weak with decliners beating advancers 573 to 199 and 291.
Malaysia's ringgit headed for a third week of losses after official data showed the nation's current- account surplus narrowed to the least in almost three years and economic growth slowed, Bloomberg reported.
The ringgit was at 4.0310 to the US dollar from 4.0250 the previous day and firmer against the pound sterling to 5.82165 from 5.8104. It firmed up aganst the Singapore dollar at 2.9317 from 2.9387 and was also stronger against the euro at 4.5848 from 4.5800.
Malaysia's economy grew at a slower pace of 4.2% in the first quarter of 2016, due to slower growth in the manufacturing and services sectors.
Meanwhile, MSCI had in its May semi annual index review reduced its weightage for investment in Malaysian equities. Under its reblancing which takes effected after market close on May 31, the weightage would be increased for IHH Healthcare and Public Bank but reduced for CIMB, Maybank, AmBank, Sime Darby, Petronas Chemicals and Petronas Dagangan.
On the external front, China stocks were little changed on Friday morning, but the benchmark index is heading towards its fourth week of declines amid increasing doubts over the strength of the country's economic recovery. Hong Kong shares dropped to a fresh two-month low, dragged lower by energy and tech shares, Reuters reported.
Maybank wiped out 5.85 points from the KLCI when it fell 36 sen to RM8.46, CIMB erased 3.91 points when it slumped 27 sen to RM4.40 while HLFG lost 26 sen to RM14.86. AmBank lost seven sen to RM4.45, Hong Leong Bank and RHB Bank four sen each to RM13.26 and RM5.96. Public Bank rose eight sen to RM19.08.
US light crude oil fell 31 cents to US$46.39 and Brent 27 cents lower atUS$47.81.
Petronas Chemicals lost 27 sen to RM6.18, Petronas Gas six sen to RM21.32 and Petronas Dagangan two sen to RM22.70. SK Petro lost four sen to RM7.34. Bumi Armada
lost four sen to 73 sen after it was removed from the MSCI list.
Crude palm oil for third month deivery fell RM59 to RM2,589 per tonne. Sime Darby lost 25 sen to RM 7.34 and erased 2.6 points, Genting Plantations 18 sen to RM10.60, also down 18 sen was KL Kepong to RM22.92, PPB Group was flat at RM15.64.
Tenaga Nasional rose four RM14 and added 0.37 of a point to the KLCI. IHH Healthcare added 10 sen to RM6.58 and pushed the KLCI up 1.36 points.
However, Genting Bhd fell 11 sen to RM8.64 and UMW lower by 19 sen to RM6.07.
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