KUALA LUMPUR (NewsRise) -- Malaysian shares fell Wednesday, as an accelerated decline in global oil prices dampened sentiment in Asia, reversing the previous session's rebound.
The nation's benchmark FTSE Bursa Malaysia KLCI declined 0.64% to 1,618.83 points. Risk aversion amid China's growth worries and a slump in oil prices has driven a 4.4% decline on the index in 2016 so far. Shares had risen 0.41% Tuesday, their first gain in four sessions.
SapuraKencana Petroleum, Petronas Chemicals Group and financial stocks led losses on the KLCI, while IHH Healthcare and British American Tobacco Malaysia were among the top gainers.
The ringgit fell 0.65% to 4.391. The depreciation in the Chinese yuan and foreign portfolio outflows has brought the ringgit and other regional currencies under pressure this month. The ringgit has shed 2.4% in January.
Brent crude oil prices slid 3% Wednesday, trading below $28 per barrel. A warning about oversupply from the International Energy Agency further deepened concerns of a glut. Crude oil prices had risen almost one percent Tuesday, but have shed 23% in January.
Weak economic data out of China and U.S., the world's two largest economies, is also keeping investors wary as risks of a global slowdown increase.
Asian indices fell, wiping out Tuesday's advances. The MSCI International All country Asia Pacific excluding Japan index has slipped almost 12% in 2016, near its lowest level in four-years.
Hong Kong's Hang Seng and Japan's Nikkei 225 index slumped 3.82% and 3.71%, while South Korea's Kospi and China's Shanghai composite index declined 2.41% and 1.04%.
U.S. stock futures indicate sharp declines on Wall Street on Wednesday, while European shares fell more than 3%.
In Southeast Asia, Singapore's Strait Times index and Thailand's SET index fell 2.97% and 1.39%. Philippine's PSE Composite index and Indonesia's Jakarta Stock Exchange Composite fell 1.53% and 1.42%.
On the KLCI, 19 of the 30 constituents ended lower, while overall declining issues outnumbered advancing ones 830 to 168.
"Despite near term external volatilities, we remain hopeful of 1,600 psychological support," said Nick Foo of Hong Leong Investment Bank. "However, failure to defend 1,600 will see a further slide towards 1550- 1568 zones, reversing our short-term cautiously optimism tone."
Foreign investors were net sellers on the KLCI for the ninth consecutive day Tuesday, selling shares worth 106.8 million ringgit ($24.5 million), according to BIMB Securities. Overseas investors have withdrawn almost 1.76 billion ringgit from the Malaysian markets since the beginning of the year.
Malaysia's consumer price index rose 2.7% in December, in line with market expectations, data released Wednesday showed.
"While inflation ticked up slightly, the balance of risks is skewed towards growth disappointment and fiscal slippage," said Weimen NG of AMZ Research in a note.
Weimen expects the nation's central bank to "maintain a wait-and-watch stance in tomorrow's policy meeting as growth risks constrain any space for a hike while currency weakness limits space for a cut."
SapuraKencana Petroleum declined 4.14% to 1.62 ringgit. The slump in global crude oil prices has contributed to a near 20% fall in the nation's biggest oil and gas services company so far this year.
Integrated chemical producer Petronas Chemicals declined 2.78% to 6.99 ringgit, giving up yesterday's entire 2.5% advance.
Banking stocks also failed to hold onto Tuesday's gains, with CIMB Group Holdings falling 1.73% to 3.97 ringgit. RHB Capital, which rose 1.3% Tuesday, declined 0.95% to 5.22 ringgit.
Hong Leong Financial Group and AMMB Holdings fell 1.19% to 13.28 ringgit and 1.59% to 4.32 ringgit, having advanced 1.5% and 1% yesterday.
Automaker UMW Holdings, among the worst performing stocks on the KLCI this month, extended losses to fall 4.96% to 6.7 ringgit.
British American Malaysia Tobacco continued its outperformance vis-a-vis the benchmark index, advancing 0.32% to 55.96 ringgit. The cigarette maker is down 0.2% since the beginning of the year.
IHH Healthcare rose 0.31% to 6.55 ringgit. Asia's largest hospital operator, also a relative outperformer, is mostly unchanged in 2016.