A man wearing a face mask to protect against Covid-19 walks past two Malaysian flags in the capital, Kuala Lumpur.
Faris Hadziq | SOPA pictures | LightRocket via Getty Images
Stocks in Malaysia fell in trading on Monday as the government announced a nationwide “total lockdown” to contain the rapidly rising daily Covid-19 infections in the country.
The benchmark FTSE Bursa Malaysia KLCI Index started falling around 1.5% before closing the session 0.7% – trailing many Asia-Pacific markets.
Malaysia is struggling to control an increase in Covid infections. Last week, the country reported a record spike in coronavirus cases for five consecutive days, bringing cumulative infections to more than 565,500 cases with 2,729 deaths by Sunday, data from the Department of Health showed.
Prime Minister Muhyiddin Yassin announced on Friday after the stock market closed that the country would initiate a two-week lockdown from Tuesday.
During the period, people are usually only allowed to leave their homes to buy essentials or get medical help. For businesses, those offering essential services remain open, while certain segments of manufacturing can operate at reduced capacity.
Brian Tan, an economist at Barclays Bank in Singapore, estimates the measures will cost the Malaysian economy between 0.5 and 1 percentage point every two weeks.
Tan wrote in a Monday note that he has cut Malaysia’s growth forecast for 2021 from 6.5% to 5.5% – below the central bank’s projection range of 6% to 7.5%.