KUALA LUMPUR, Sept 15 (Reuters) - Malaysian planters fell steeply on Monday, to track falling crude palm oil prices, while growing uncertainty on the domestic political front dampened sentiment in the broader market.
Uncertainty about the health of the U.S. financial sector and the fate of troubled U.S. investment bank Lehman Brothers (LEH.N: Quote, Profile, Research, Stock Buzz) also added to the pressure, resulting in selling by foreign investors.
"It's a combination of many things today," said a local brokerage house dealer.
"Politics are obviously a big overall concern, while falling CPO prices are also a big worry for the planters. And then there is the Lehman issue. All of this is leading to selling, especially by foreigners," he said.
Plantation stocks had been foreign investors' favourite counters on the Malaysian bourse.
By 0130 GMT, Sime Darby (SIME.KL: Quote, Profile, Research, Stock Buzz), the No. 2 company on the local bourse by market value, was down 2.5 percent to 5.95 ringgit, underperforming the broader market index .KLSE, which was down 1.41 percent.
Second-biggest planter IOI Corp (IOIB.KL: Quote, Profile, Research, Stock Buzz), ranked seven on main index, had dropped nearly 6 percent to 4.12 ringgit.
Other plantation stocks also posted losses. Kuala Lumpur Kepong (KLKK.KL: Quote, Profile, Research, Stock Buzz) fell 1.92 percent, while Kulim Bhd (KULM.KL: Quote, Profile, Research, Stock Buzz) was down 5.93 percent.
Malaysian stocks have shed more than a quarter of their value so far this year as foreign investors ditched Malaysian assets due to rising political risk.
[source]