The Bank of Russia unexpectedly maintained its key interest rate at a record-high 21% , defying analysts’ expectations of another significant hike as inflation remains stubbornly elevated. The decision marks a shift toward a more measured approach in balancing economic growth and price stability. Key Details Inflation Concerns: Annual inflation climbed to 8.9% in November, well above the central bank’s 4% target , with inflation expectations reaching 13.9% in December. Policy Rationale: The central bank cited the significant tightening of monetary conditions after October’s 200-basis point hike as sufficient to resume disinflationary processes. Governor Elvira Nabiullina emphasized avoiding both economic overheating and severe slowdowns. Economic Overheating: Elevated government spending on the war in Ukraine and social programs, coupled with labor shortages and rising wages, have fueled strong domestic demand, exacerbating price pressures...
KUALA LUMPUR (May 31): Bursa Malaysia and regional bourses sank into the red on Wednesday (May 31), amid uncertainties over whether the US Congress would resolve the debt ceiling impasse later in the day.
Hong Kong’s Hang Seng Index led the regional decline, losing 1.94% to 18,234.27, Japan’s Nikkei 225 fell 1.41% to 30,887.88, Singapore’s Straits Times Index eased 0.90% to 3,158.80, and China’s SSE Composite Index dipped by 0.61% to 3,204.56.
The FBM KLCI, the domestic barometer index, ended the day 9.79 points or 0.70% lower at 1,387.12, from 1,396.91 at Tuesday’s close.
The key index opened 0.23 of a point weaker at 1,396.68, and subsequently fluctuated to an intraday low of 1,380.90, or 1.1% lower, and an intraday high of 1,398.38 in the early morning session.
The broader market was bearish, with decliners thumping advancers 521 to 360, while 387 counters were unchanged, 980 untraded, and 33 others suspended.
Turnover jumped to 3.54 billion units worth RM5.25 billion, versus 2.38 billion units valued at RM2.01 billion on Tuesday.
A major debt ceiling bill negotiated by US President Joe Biden and House Speaker Kevin McCarthy passed through a House Committee on Tuesday, and will now go to the full House for a vote expected later on Wednesday.
Rakuten Trade Sdn Bhd equity research vice-president Thong Pak Leng said the focus will remain on developments in the implementation of the US debt deal right up to the June 5 deadline.
Meanwhile, he said the faster-than-expected fall in China's manufacturing print showed that its economic recovery continued to lose steam, further triggering a sour market mood.
It was reported that China’s purchasing managers index slipped to 48.8 this month from 49.2 in April, according to data released by the National Bureau of Statistics on Wednesday. A reading below 50 indicates contraction.
Nevertheless, Thong views the current low valuations in the local equity market to be attractive to entice bargain hunters.
“On the domestic front, sentiments may be cautious in view of external factors. However, we believe the KLCI has been significantly undervalued.
“Hence, we expect the key index to hover within the 1,385-1,395 range for the remainder of the week, with immediate support at 1,370 and resistance at 1,400,” he told Bernama.
Among the heavyweights, Malayan Banking Bhd (Maybank) added six sen to RM8.65 a share, Public Bank Bhd lost three sen to RM3.81, Tenaga Nasional Bhd was 11 sen weaker at RM9.51, Petronas Chemicals Group Bhd dipped 19 sen to RM6.56, while CelcomDigi Bhd eased 10 sen to RM4.47.
CIMB Group Holdings Bhd was down seven sen to RM4.82, and IHH Healthcare Bhd slid one sen to RM5.77.
Among the actives, MyEG Services Bhd was five sen better at 84 sen, Main Market debutant Radium Development Bhd slipped 11.5 sen to 38.5 sen, YTL Corp Bhd rose six sen to 97 sen, while Hap Seng Consolidated Bhd fell 44 sen to RM3.62.
On the index board, the FBM Emas Index slid 36.02 points to 10,243.09, the FBMT 100 Index was 33.39 points easier at 9,949.51, the FBM Emas Shariah Index erased 47.90 points to 10,606.51, the FBM ACE Index was 19.85 points lower at 4,947.24, and the FBM 70 Index surged 105.98 points to 13,656.87.
Sector-wise, the Financial Services Index trimmed 62.56 points to 15,206.74, the Industrial Products and Services Index lost 3.41 points to 159.11, the Plantation Index tumbled 146.42 points to 6,601.08, and the Energy Index shed 17.60 points to 809.44.
The Main Market volume jumped to 2.75 billion units valued at RM5.03 billion, from 1.61 billion units valued at RM1.79 billion on Tuesday.
Warrant turnover narrowed to 253.92 million units worth RM35.22 million, against 291.34 million units worth RM35.75 million a day earlier.
The ACE Market volume swelled to 535.22 million shares valued at RM186.02 million, from 475.20 million shares valued at RM179.17 million previously.
Consumer products and services counters accounted for 383.27 million shares traded on the Main Market, followed by industrial products and services (441.19 million), construction (111.22 million), technology (400.56 million), special purpose acquisition companies (nil), financial services (267.63 million), property (375.73 million), plantation (48.97 million), real estate investment trusts (58.50 million), closed/funds (135,600), energy (162.04 million), healthcare (163.48 million), telecommunications and media (119.69 million), transportation and logistics (41.15 million), and utilities (175.42 million).
Source: The Edge
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