Malaysian share prices closed 0.30 percent lower Friday with most investors reluctant to take fresh positions ahead of the weekend, dealers said.
They said share prices closed lower after opening marginally higher, with caution over rising interest rates affecting sentiment.
The central bank announced earlier this week a 30-basis point increase in its overnight policy rate to 3.0 percent.
The Kuala Lumpur Composite Index was down 2.66 points at 885.14.
Losers outnumbered gainers 391 to 264, with 319 stocks unchanged and 356 non-traded. Volume was 270.16 million shares, worth 671.25 million ringgit (178 million dollars). The ringgit was traded at 3.7790 to the US dollar and 4.4330 to the euro.
"The market is seeing the negative effect of the interest rate hike. Though the current rate hike is mild, investors were worried that there will be more hikes down the road," a local brokerage dealer said.
"Today's fall was also due to the sell-off of heavyweights Tenaga and Telekom," he said.
For next week, he said the market will be finding a base around 870-880 points.
Among blue chips, Tenaga Nasional was down 0.15 ringgit at 9.60, Telekom Malaysia down 0.10 at 9.30 while Maybank was flat at 11.10.
PSC Industries, parent of shipbuilder PSC-Naval Dockyard involved in a troubled navy deal, lost 0.185 to 0.44 after the company said it is an affected issuer under Practice Note 17, a category for financially troubled companies.
National carmaker Proton slipped 0.25 to 6.25 after gaining earlier on a technical rebound in response to recent falls, dealers said.
Property developer SP Setia shed 0.16 to 3.16 on fears that its earnings will be affected by higher interest rates.
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