KUALA LUMPUR: Bursa Malaysia closed lower on Wednesday, mirroring the broad selling pressure observed across the region, with technology and energy stocks also declining.
At 5pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) dropped 1.24 per cent or 20.55 points to 1,639.80 from Tuesday's closing of 1,660.35.
The broader market was bearish, with 822 losers outpacing 282 gainers, while 437 counters remained unchanged.
Rakuten Trade Sdn Bhd equity research vice-president Thong Pak Leng said the Asian stocks dropped due to worries that the US Federal Reserve may have postponed easing monetary policy for too long.
"On the local front, we maintain a cautious stance given the growing global volatility and uncertainties.
"That said, the solid fundamentals of the Malaysian economy and companies suggest that bargain hunting could emerge with stocks trading at attractive levels.
"As such we anticipate the benchmark index to trend within the range of 1,640-1,670 for the rest of the week," he said.
He added that traders are anticipating at least one significant Fed rate cut this year, ahead of a consumer price report expected to show muted inflation growth.
"US inflation reports due this week could impact the size of the Fed's upcoming rate cuts," he said.
Thong said the worst-case scenario for the Fed would be a rebound in inflation coupled with a declining job market, as tackling either problem would necessitate opposing measures.