Wednesday February 28, 2007
Regional sell-off on China fears
By KEITH HIEW
KUALA LUMPUR: The KL Composite Index plunged in tandem with regional markets on what equity researchers say could be due to investment tightening measures imposed by foreign governments as well as interest rates increases.
However, the Bursa staged a strong late recovery, possibly due to late institutional support, to close 35.79 points lower at 1,237.08, or 2.81%, after having recorded a massive 53.24-point plunge only about 13 minutes earlier at 4.47pm.
Regional bourses did not fare any better, with the Shanghai and Shenzhen bourses of China the biggest losers with 8.84% and 8.54% decreases respectively, while Singapore’s Straits Times Index recorded a 2.29% slide.
In a random survey, most equity researchers and fund managers believe the strong fundamentals of the Malaysian economy would lend support to the share market. However, StarBiz technical chartist G.M. Teoh said there could be more drastic downside.
Hong Kong’s Daiwa Asset Management Ltd fund manager Mona Chung told Bloomberg that investors could be worried that China might impose tightening measures on illegal investments that have driven benchmarks to records, while China National People's Congress vice-chairman Cheng Siwei had earlier this month warned of stock market “bubbles.”
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Losers crushed gainers by 1,157 to 42, with 60 counters remaining unchanged.
Among the top gainers were newly listed H-Displays (MSC) Bhd, KFC Holdings (Malaysia) Bhd and MISC Bhd.
Related stories:
Most still positive on Bursa
Previous stories:
KLCI poised to break record
KLCI soars to a 13-year high
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