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.
Gold prices edged higher on Tuesday after reaching multi-week lows, as US central bank policymakers signaled the possibility of a September interest rate cut. The move comes amid broader market volatility and economic concerns.
Key Developments
Gold Prices:
- Spot Gold: Rose 0.2% to US$2,411.97 per ounce as of 0200 GMT.
- US Gold Futures: Increased 0.3% to US$2,452.60.
Recent Market Activity:
- Gold experienced its worst day in nearly two weeks during the previous session, as a global market sell-off was driven by mounting economic concerns.
Federal Reserve and Rate-Cut Expectations
Fed Policymaker Statements:
- US central bank policymakers have downplayed the notion that weaker-than-expected July jobs data indicates an impending recession but acknowledged the need for potential rate cuts to avoid such a scenario.
- Mary Daly, president of the Federal Reserve Bank of San Francisco, expressed openness to cutting interest rates if necessary and emphasized the need for proactive policy measures.
Rate-Cut Projections:
- Traders are pricing in a 50-basis-point cut at the Fed's September meeting, with an additional cut anticipated in December, according to CME FedWatch.
Impact on Dollar and Bond Yields:
- Lower interest rates generally exert pressure on the US dollar and bond yields, thereby increasing the attractiveness of non-yielding assets like gold.
Economic Indicators and Market Outlook
Upcoming Data Releases:
- Markets are watching for US trade deficit data due later in the day and initial jobless claims data on Thursday.
US Services Sector:
- Data released on Monday showed that US services sector activity rebounded from a four-year low in July, driven by a rise in new orders and the first increase in employment in six months.
Other Precious Metals
Silver:
- Spot silver gained 0.2% to US$27.33 per ounce.
Platinum:
- Increased nearly 1% to US$914.90.
Palladium:
- Rose 0.8% to US$856.83, after reaching its lowest levels since August 2018 on Monday.
Conclusion
The upward movement in gold prices reflects renewed optimism about potential interest rate cuts by the Federal Reserve. While recent economic data have painted a mixed picture, the prospect of lower rates has bolstered the appeal of gold and other precious metals. As investors continue to assess economic conditions and central bank actions, the focus will remain on upcoming data releases and policy signals that could influence market dynamics.
Comments
Post a Comment