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Nikkei Markets

Malaysia shares fall as caution prevails ahead of polls

Singapore shares edge higher amid mixed Asian markets

KUALA LUMPUR (Nikkei Markets) -- Malaysian shares fell on Wednesday as investors stayed cautious ahead of national elections, seeking local cues amid mixed Asian markets. Singapore shares seesawed through the session to end slightly higher.

The FBM KLCI fell 1% at 1852.03, while the Straits Times Index ended a tad higher at 3614.69. In Malaysia, 25 out of 30 companies of the index declined while in Singapore, banks and real estate stocks retreated. Both markets were shut on Tuesday for Labor Day.

"Election concerns in Malaysia will outweigh global factors for now," said Phillip Mutual Chief Strategist Phua Lee Kerk. "Investors may want to conserve more cash unless they're very positive the current administration will secure a stronger victory this time round."

Election campaign is shifting into high gear in Malaysia ahead of the May 9 vote. Prime Minister Najib Razak and his National Front coalition are favored to retain power despite resurgent opposition led by his mentor-turned rival Mahathir Mohamed.

Further weighing on investors sentiment, business conditions in Malaysia's key manufacturing sector worsened for the third straight month in April. The Nikkei Malaysia Manufacturing Purchasing Managers' Index fell to a six-month low of 48.6 in April, data from a survey released Wednesday showed.

"Investors in Singapore are very much exposed to global shifts in sentiment, and at the moment, there's also concern on how any development following the outcome of the Malaysian election could affect demand, given Malaysia is among major export destinations," said Philip Mutual's Phua.

Technology stocks were in focus in Malaysia and Singapore after Apple reported an above-estimate earnings and revenue in the second quarter. Further, global semiconductor sales increased 20% on-year in the first quarter, according to Semiconductor Industry Association.

Inari Amertron rose 5.2% while KESM Industries was 0.6% higher. Hi-P International gained 1.8%.

Public Bank, which reported a 13% on-year increase in first-quarter net profit, climbed 0.8% while IHH Healthcare declined 1.3% after the company raised its offer for India's Fortis Healthcare by 9.4% to 175 rupees ($2.62) a share.

Oil prices gained in New York and London amid renewed worries of U.S. sanctions on Iran, helping boost Sapura Energy and Hibiscus Petroleum by 11% and 5.3% respectively.

Petronas Chemicals, however, declined 0.5%. The petrochemical company said it is planning to invest 4.3 billion ringgit ($1.9 billion) over the next two years mostly to complete its Pengerang project.

In Singapore, Singapore Telecommunications dropped 0.6%. On Wednesday, a report said the telco and local gaming company Razer were working together to create the largest e-payment network in Southeast Asia.

Commercial and industrial real estate investment trust Ascendas REIT, an STI component stock, added 0.4% following news it had completed the proposed divestment of No. 30 Old Toh Tuck Road for S$24 million ($18 million).

SPH Reit closed unchanged. Earlier, iIts manager had said the trust will acquire The Rail Mall for S$63.2 million. The mall is located along Upper Bukit Timah Road, and comprises 43 single-storey shop units and 95 private carpark lots.

-- Alexander Winifred and Joannah Perez

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