Glove stocks rally as new Covid-19 variant spooks investors  

KUALA LUMPUR: Glove stocks rallied, extending Friday’s surge, amid bets that Omicron coronavirus variant would boost demand for the protective gear.

Top producers Top Glove Corp Bhd, Hartalega Holdings Bhd and Supermax Corp Bhd jumped as much 30% on before succumbing to quick profit taking on Monday.

Fears about the possible vaccine resistant variants, however dragged the broader market lower on fresh worries about the outlook for border reopenings and global economic growth.

At the close the FTSE Bursa Malaysia KL Composite Index declined 1.65 points, or 0.11% to 1,510.57 points.

Losers outpaced gainers 790 to 351, with 376 counters unchanged.

Turnover was higher at 61.4 billion shares worth RM5.2bil Glove stocks dominated the ten most actively traded counters on Monday.

The sector was one of the hottest pandemic trades in 2020 but many of the glove producers more than halved in their market value this year.

“Demand growth and pricing won’t go back to 2020 levels but there will be some improvement especially if virus cases rise,” said Danny Wong, chief executive officer of Areca Capital Sdn told Bloomberg today.

Elsewhere in the region, stocks were broadly lower.

In Singapore, the main Straits Times Index tumbled 1.4% to 3,120 points, while in Hong Kong the Hang Seng Index fell 1% to its lowest level since October 2020, extending a 2.7% drop on Friday.