KUALA LUMPUR (Aug 28): Top Glove Corp Bhd and Hartalega Holdings Bhd's share prices fell among notable decliners in morning trade on Bursa Malaysia today after analysts downgraded the Malaysian rubber glove sector on a confluence of factors, including the deceleration of new Covid-19 infections and faster-than-expected development of vaccines to curb the spread of the pandemic.

At 10am, Top Glove had dropped 14 sen or 0.53% to RM26.26, while Hartalega fell six sen or 0.36% to RM16.80.

Yesterday, JF Apex Securities Bhd analysts wrote in a note that the rubber glove sector was seeing a "reversal of fortune".

"We downgrade the sector to 'neutral' from 'overweight' on the back of: i) the deceleration of new Covid-19 infections; ii) faster-than-expected development of vaccines; iii) the momentum of rising ASPs (average selling prices) of gloves might not be as strong as initially thought as more companies join the bandwagon of manufacturing medical gloves; and iv) demand for glove is tapering as a result of less social activities.

"Countries which have the most Covid-19 cases, such as the US and Brazil, are being alleviated in which the five-day moving average number of new cases has gone down significantly from July’s peak.

"Development of vaccines for Covid-19 has [also] accelerated significantly," JF Apex added.

Edited by Chong Jin Hun