KUALA LUMPUR, Sept 8 (Bernama) -- Bursa Malaysia closed almost flat on Tuesday as buying interest rotated away from index heavyweights towards smaller-cap construction stocks, with sentiment affected by geopolitical uncertainty, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 0.39 of a point to 1,714.40 from Monday’s close of 1,714.79. The benchmark index opened 1.65 points lower at 1,713.14 and moved between 1,710.44 and 1,714.50 throughout the trading session. The broader market was almost evenly balanced, with decliners leading gainers 548 to 546, while 598 counters were unchanged, 1,107 were untraded and 25 were suspended. Turnover expanded to 4.13 billion units valued at RM3.14 billion from 3.60 billion units valued at RM2.45 billion on Monday.
Gold prices edged lower on Tuesday as investors booked profits after bullion hit a more than one-week high. Market participants are now turning their attention to key US inflation data, which could provide crucial insights into the Federal Reserve's upcoming policy decisions.
Key Highlights:
Gold Price Movement: Spot gold fell by 0.4% to $2,462.19 per ounce by 0259 GMT after reaching its highest level since August 2 earlier in the session. This follows a more than 1% rise in the previous session. US gold futures remained relatively unchanged at $2,502.40.
Profit-Taking: The dip in gold prices is attributed to profit-taking, as traders capitalize on recent gains. Tim Waterer, chief market analyst at KCM Trade, noted that gold had a solid start to the week but eased slightly due to moderate profit-taking.
US Inflation Data: Investors are eagerly awaiting the release of July US producer price figures later today, followed by the consumer price index (CPI) data on Wednesday. These reports are expected to shed light on the likelihood of significant rate cuts by the Federal Reserve. The CPI is anticipated to show a 0.2% month-on-month increase in both headline and core prices.
Fed Rate Cut Speculation: Markets currently see about a 50% chance of a 50 basis points (bps) rate cut in September, according to the CME FedWatch Tool. A softer inflation reading could bolster hopes for an aggressive rate cut, which would likely enhance the appeal of non-yielding assets like gold.
Geopolitical Tensions: On the geopolitical front, tensions remain high as Israeli Prime Minister Benjamin Netanyahu clashed with his defense minister, highlighting deep internal divisions within the government amid the ongoing war in Gaza and the risk of a broader regional conflict.
Other Metals: In other precious metals, spot silver fell by 1.2% to $27.67 per ounce, platinum edged 0.3% lower to $933.96, and palladium declined by 0.6% to $914.25.
The upcoming US inflation data will be closely monitored, as it could significantly influence market expectations regarding the Federal Reserve's rate policy and, consequently, the direction of gold prices.
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