KUALA LUMPUR (Nikkei Markets) -- Malaysian stocks fell Monday, while Singapore shares rose on the final day of 2018 in holiday-thinned trade with both equity gauges closing the year with losses.
The FBM KLCI finished 0.1% lower at 1690.58, capping the year with 5.9% decline. The Straits Times Index ended 0.5% higher at 3,068.76 in half-day trading session marking an annual loss of nearly 10%. Both markets will be shut on Tuesday for New Year's Day.
Malaysia's main stock index appeared to be in bear market, said Inter-Pacific Research Analyst Pong Teng Siew, flagging possibility of the index falling towards 1538, or as much as 9%, by June next year if corporate earnings disappoint further. "This forms our worst-case scenario for the KLCI," he said.
Both markets started declining in the second quarter of 2018 as U.S. and China imposed tit-for-tat tariffs worth hundreds of billions of dollars. The trade tensions escalated in ensuing months, heightening caution for investors over outcome of the ongoing tariff war on trade-reliant economies such as Malaysia and Singapore.
Malaysian stocks also hobbled as policy uncertainties crept in the months following a shocking electoral defeat of National Front coalition that paved way for a transition of power for the first time in more than six decades in Southeast Asia's third largest economy.
The U.S. Federal Reserve's four interest rate increases during the year and fears over emerging markets as well as slowing global economic growth also contributed to the risk-off sentiment, clouding the outlook for 2019.
Telecommunication firm Maxis was the biggest index loser in Malaysia on Monday after declining 2%. In Singapore, beer and spirit company Thai Beverage climbed more than 4% to lead other gainers on the gauge.
In corporate news, Keppel Corp. edged up 0.2% after the industrial conglomerate and Singapore Press Holdings announced their firm intention to make a voluntary general offer for the remaining M1 shares they do not already own at S$2.06 per share.
The companies had announced their intention to make the offer for Singapore's third-largest telecommunications company through joint venture company Konnectivity in September. M1 ended 0.5% lower, while SPH ended flat.
Scientex fell 3.3% after the Malaysian packaging firm reported a 26% year-on-year plunge in first-quarter net profit to 53.67 million ringgit ($12.99 million).
Property developer Berjaya Land rose over 7% in Malaysia on news of Vietnam hotel sale. The company plans to sell its entire 75% stake in a five-star hotel in Hanoi for 1.24 trillion Vietnam Dong ($53.68 million).