Malaysia's stock exchange falls ahead of expected dissolution announcement

KUALA LUMPUR - Malaysia's stock exchange fell close to 40 points or 2.4 per cent to 1.649.84 points at 10.20 am and is fluctuating, as investors take profit ahead of expectations that Prime Minister Najib Razak will announce Parliament dissolution at 11.30 am this morning.

The KLCI opened 4.78 points higher this morning at 1,689.78, but quickly fell 10 points within the hour, as rumours of Mr Najib calling the elections went wild.

Mr Najib had announced on his Twitter at 9.41am that he would be giving an address on live telecast later.

At 10.30 am, the stock exchange slumped across the board, led by government-linked companies such as Felda Global Ventures, which fell 4.04 per cent or 19 cents (S$0.08) to RM4.51 and blue chip stocks such as British American Tobacco (Malaysia) Bhd that fell 2.67 per cent or RM1.70 to RM62

Financial analysts said investors are jittery of the election outcome and are retreating from the stock exchange ahead of the polls, which is seen as the fiercest competition between Barisan Nasional coalition and opposition Pakatan Rakyat to win federal power.

"Investors are jittery as this elections are seen as different from previous ones," Mr Terence Wong, CIMB Securities research head, told The Straits Times. "We expect more selling pressure to happen during the campaigning season as investors stay on the sidelines."

Join ST's Telegram channel and get the latest breaking news delivered to you.