The ringgit declined 0.4 per cent to 4.215 against the dollar, its lowest level in over eight months. The unit has declined 2 per cent this month.

According to a report in the Nikkei Asian Review (NAR), this was mainly due to weakness in the Chinese yuan and broad dollar strength amid the increased Federal Reserve rate hike expectations weighed on regional currencies.

“Cautious trading could prevail this week ahead of the release of China’s 3Q16 GDP on Wednesday.

“If China sends the signal for further systematic devaluation of the yuan to arrest dwindling exports, regional currencies could feel the heat,” NAR quoted Kaladher Govindan, head of research at TA Securities as saying in a note.

Govindan said weakness in the ringgit might continue to undermine foreign participation in the local equity market, even as exporters might benefit from the weak local currency.

Foreign investors sold RM227.4 million in Malaysian shares last week, compared with an inflow of RM118.8 million the week before, according to MIDF Research.

Foreign inflows into local equities so far this year now stand at RM2.2 billion, according to the NAR report.

On the KLCI, 19 of the 30 constituents ended lower Monday and three closed unchanged, while overall declining issues outnumbered advancing ones 440 to 322.

DiGi.Com, which reports earnings on Wednesday, declined 0.6 per cent to RM4.97. Its rivals Maxis and Axiata Group lost 0.7 per cent to RM5.98 and 0.4 per cent to RM5.09 respectively. Telekom Malaysia, however, rose 0.3 per cent to RM6.70.

NAR reported that most brokerages remained underweight on Malaysian telecom stocks as expectations of a sustained price-war would likely remain a major overhang on the sector.

Analysts have warned that if these companies were to slash dividend payouts, they risked lowered valuations.

Genting Malaysia slipped 1.3 per cent to RM4.73 and Sime Darby slid 1.4 per cent to RM7.75 Monday. CIMB Group Holdings and Hong Leong Bank rose 0.4 per cent toRM4.77 and 0.3 per cent to RM13.20 respectively.