KUALA LUMPUR, July 29 (Bernama) -- Bursa Malaysia rebounded to close higher on Wednesday on selective buying of defensive stocks after a volatile trading session. IPPFA Sdn Bhd director of investment strategy and country economist Mohd Sedek Jantan said consumer products and services stocks lifted the key index higher, overcoming lingering geopolitical concerns. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 3.08 points to 1,715.56 from yesterday’s close of 1,712.48. The benchmark index, which opened 1.91 points higher at 1,714.39, moved between 1,710.79 and 1,720.59 during the day’s trading. In the broader market, gainers outstripped decliners 550 to 476, while 612 counters were unchanged, 1,129 untraded, and 48 suspended. Turnover rose to 2.96 billion units valued at RM2.48 billion from 2.94 billion units valued at RM2.56 billion on Tuesday.
Traders have intensified their bets on the Federal Reserve implementing three interest rate cuts this year, bolstered by Goldman Sachs Group Inc.'s recent forecast suggesting that conditions are ideal for monetary easing. With two quarter-point reductions already priced in for 2024, the market is now seeing an increasing probability of a third cut, following softer-than-expected employment and inflation data for June.
- Market Pricing: Two quarter-point rate cuts are fully priced in for 2024, with a 60% likelihood of a third cut by year-end.
- Goldman Sachs Forecast: Economists at Goldman Sachs suggest there is a strong case for a rate cut as early as July, although they still predict the first cut in September.
- Fed Swaps and Futures: December contracts are pricing in about 62 basis points of easing, indicating significant market anticipation for rate reductions.
- Fed Chair's Comments: Fed Chair Jerome Powell emphasized the central bank’s confidence in achieving its 2% inflation goal but refrained from indicating the timing of rate cuts.
- Meeting Schedule: The Federal Open Market Committee’s upcoming meetings conclude on July 31, Sept. 18, Nov. 7, and Dec. 18.
Conclusion
The market's heightened expectations for Federal Reserve rate cuts underscore the shifting economic outlook as traders respond to evolving data and forecasts. With Goldman Sachs highlighting the potential for an early cut, attention now turns to upcoming Fed meetings and key economic indicators that will shape the trajectory of monetary policy through the rest of 2024.
Comments
Post a Comment