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Nikkei Markets

Malaysia, Singapore shares extend losses after Wall Street slide

Growth fear rattles investors as focus shifts from headlines to fundamentals

KUALA LUMPUR (Nikkei Markets) -- Malaysia and Singapore shares fell for a second day on Wednesday taking cues from a slide on Wall Street overnight amid renewed uncertainty over the outcome of Sino-American trade talks.

The FBM KLCI ended 0.4% lower at 1,688.27. Maxis dropped 2.2% and other telecom firms also weighed on the Malaysian index. The Straits Times Index also closed down 0.4% at 3,155.92. Thai Beverage was the biggest loser on the Singaporean gauge after falling 2.4%.

"Fear of possible slowdown in global growth next year against the backdrop of trade uncertainties and rising interest rates has started to erode the foundation of this bull market," said Margaret Yang, market analyst at CMC Markets. "Market focus shifted back to fundamental metrics, with recent PMIs suggesting global demand is weakening."

Data released during the week showed slowing factory activity growth in Singapore, while manufacturing conditions in Malaysia fell to a six-month low. In the rest of Asia, the Nikkei Asia300 Index fell 1.5% amid broad losses in the region after major indexes on Wall Street shed 3% or more on Tuesday.

Investors continue to watch developments on trade between the U.S. and China. The U.S. has agreed to hold off for 90 days on a planned increase in import duties on $200 billion worth of Chinese goods. China's Ministry of Commerce said on its website that Beijing will begin to implement measures on which the two nations reached an agreement as soon as possible.

The Xi-Trump meeting was "very successful," the ministry said. The decision follows an agreement between the U.S. and Chinese presidents at a G-20 summit in Argentina over the weekend.

Separately, declining yields on long-dated U.S. bonds raised concerns over growth in the world's largest economy. The yield on 10-year U.S. Treasury notes fell for a sixth day on Tuesday, even as the Federal Reserve is widely expected to raise rates for a fourth time this year later this month.

Bucking the decline, Techbond Group made strong trading debut on the Malaysian stock exchange after raising 39.67 million ringgit ($9.55 million) from an initial public offering. The adhesive maker ended the day 30% higher.

Construction firm Kerjaya Prospek Group rose 1.7% after securing contract worth 211.60 million. Suria Capital Holdings added 1.2% following port operator's plan to issue bonus shares.

In Singapore, specialist engineering services provider Acromec jumped 13% after signing a letter of intent with Chew's Agriculture to build, own and operate a waste-to-energy power plant on a Chew's Agriculture farm. As part of the agreement, Chew's will purchase electricity from the company for 15 years.

Technology company Trek 2000 International fell 4.3% after saying the Singapore Exchange placed the company on its watch-list due to the minimum trading price entry criterion, effective Dec. 5.

Shares of MMP Resources doubled after saying it agreed to buy Lloyds Energy's 50% stake in a joint venture, which holds interest in an operating gas field in Russia. The company expects the deal consideration to be about S$25 million ($18.3 million).

- Suzannah Benjamin and Jason Ng

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