Malaysian shares almost flat Wednesday

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KUALA LUMPUR: Malaysian shares ended little changed Wednesday.

This is attributed to an unexpected decline in US second quarter productivity which revived concerns about the health of the world’s largest economy, a Nikkei Asian Review report said.

Malaysia’s benchmark FTSE Bursa Malaysia KLCI edged 0.1% higher to 1,673.03 points Wednesday.

The index is up 1.2% this month, helped by a rally in global crude prices from its recent lows and the upbeat US July jobs data.

The ringgit rose 1% to 3.98 against the dollar Wednesday, breaching the psychologically important 4.00 levels for the first time since July 18.

The disappointing US productivity numbers weighed on the dollar, as expectations of an early Federal Reserve rate increase took a backseat, said the report.

Data released Tuesday showed US productivity unexpectedly slipped 0.5% in the April-June quarter, against estimates of a 0.4% increase.

According to the Nikkei Asian Review report this was the third straight quarterly decline in productivity – the longest stretch since 1979.

Productivity figures are often seen as a gauge for long term prospects of the economy.

On the KLCI, 14 of the 30 constituents ended higher Wednesday, while five ended unchanged. Overall advancing issues outnumbered declining ones 436 to 358.

Foreign investors purchased RM163.9 million in Malaysian shares on Tuesday, according to MIDF Research.

Financial conglomerate Hong Leong Financial Group advanced 3.1% to RM15.88, leading gains on the KLCI.