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.
Asian shares rose sharply on Thursday, tracking a tech-driven rally on Wall Street, while the dollar continued to strengthen against the yen after US core inflation data came in slightly higher than expected, reducing hopes for a significant interest rate cut by the Federal Reserve (Fed) next week.
Investors are now turning their attention to the European Central Bank's (ECB) policy decision later today, where a rate cut is widely anticipated. However, uncertainty remains over whether the ECB will make further rate adjustments in October and December.
MSCI's broadest index of Asia-Pacific shares outside Japan climbed 1%. Japan's Nikkei index jumped 3%, aided by a weaker yen, which retreated from its 2024 high of 140.71 per dollar. Earlier, the yen had dipped further to a low of 142.95 but later stabilized at 142.40 per dollar, possibly buoyed by hawkish comments from a senior Bank of Japan official advocating for a rate increase to at least 1%.
In Europe, EUROSTOXX 50 futures rose 1.2%, while FTSE futures gained 0.9%. US stock futures showed minor losses.
Overnight, US data revealed that the core consumer price index (CPI) rose 0.28% in August, slightly above the forecasted 0.2% increase. This data has caused markets to nearly abandon the likelihood of a half-point rate cut from the Fed next week, with the probability now at just 15%.
"We were looking for clues to resolve the debate over a 25 versus 50 basis points Fed rate cut on Friday, but it seems the market has made its decision," said Chris Weston, Head of Research at Pepperstone. "We're now leaning towards a 25-basis-point cut for September but remain open to the possibility that a weak US payroll report on October 4 could pave the way for a 50-basis-point cut at the November Federal Open Market Committee meeting."
Despite the disappointment over the inflation figures, tech stocks buoyed Wall Street, with Nvidia Corp soaring 8%, supported by reports that the US government might allow the company to export advanced chips to Saudi Arabia.
Regional tech-heavy markets followed suit, with Taiwan adding 2.2% and South Korea gaining 1.1%. In contrast, China's markets were subdued, while Hong Kong's Hang Seng index edged up 0.4%.
In the foreign exchange market, the dollar traded near a four-week high against the euro, which eased to $1.1007, close to Wednesday's low of $1.1002, the weakest since August 16.
Short-dated US Treasuries sold off overnight, with two-year yields holding at 3.3193% after rising four basis points, while ten-year yields were at 3.3291%. This caused the two-to-ten-year yield curve to flatten slightly, remaining just barely positive at one basis point.
In commodities, oil prices bounced back overnight amid fears that Hurricane Francine could lead to extended production shutdowns in the US. Brent crude futures held steady at $70.65 a barrel after gaining 2%, supported by a base level at $68.69, the lowest in nearly three years.
Gold traded at $2,513.75 an ounce, just below its record high of $2,531.60, reflecting ongoing market uncertainty.
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