KUALA LUMPUR, Sept 20 (Bernama) -- Bursa Malaysia ended higher on Friday in line with most Asian markets, mirroring gains from Wall Street, where investors welcomed the US Federal Reserve's substantial interest rate cut. The FTSE Bursa Malaysia KLCI (FBM KLCI) rose by 3.17 points, or 0.19 per cent, to 1,668.82 at the close from Thursday's close of 1,665.65. It opened 5.03 points higher at 1,670.68, trading between 1,668.48 and 1,674.04 throughout the session. In the broader market, gainers outpaced decliners 732 to 468, while 465 counters were unchanged, 850 untraded and 32 suspended. Turnover swelled to 4.19 billion units worth RM5.97 billion, from Thursday's 3.99 billion units worth RM4.08 billion. UOB Kay Hian Wealth Advisors head of investment research, Mohd Sedek Jantan, noted the FBM KLCI's gains were led by utilities, logistics, and banking stocks, reflecting improved market sentiment. Additiona
Japan's export growth slowed significantly in August as shipments to the US fell for the first time in three years, and machinery orders unexpectedly declined in July, signaling challenges for an economy trying to establish a strong recovery.
Weaker external demand is undermining Japan's efforts to achieve sustainable economic growth, analysts say, especially with the risk of a slowdown in the US and continued weakness in China's economy, two of Japan's major trading partners.
"Japan's exports are bound to struggle as the global economy fails to pick up momentum, with growth in both the US and China expected to slow down next year," said Takeshi Minami, chief economist at Norinchukin Research Institute. He noted that the benefits of a weaker yen on exports have diminished as the currency rebounded sharply in August.
Key Data Highlights:
- Total exports rose by 5.6% year-on-year in August, marking the ninth consecutive month of growth, but well below the 10% increase forecasted by the market and following a 10.3% rise in July.
- Exports to the US dropped by 0.7%, the first monthly decline in nearly three years, primarily due to a 14.2% slump in auto sales.
- Exports to China, Japan's largest trading partner, increased by 5.2% in August compared to a year earlier.
- In terms of volume, shipments were down 2.7% from the previous year, marking the seventh consecutive month of declines.
- Imports grew by 2.3% in August year-on-year, significantly below the 13.4% increase anticipated by economists.
This led to a trade deficit of ¥695.3 billion (RM20.9 billion), lower than the forecasted deficit of ¥1.38 trillion.
Machinery Orders and Economic Indicators:
Separate data from the Cabinet Office showed that core machinery orders unexpectedly fell by 0.1% in July from the previous month, contradicting economists' expectations for a 0.5% rise. However, compared to a year earlier, core orders, a volatile data series seen as a predictor of capital spending in the coming 6 to 9 months, rose by 8.7%, exceeding the forecasted 4.2% increase.
The government maintained its assessment that the recovery in machinery orders is at a standstill.
A rise in personal consumption helped Japan's economy rebound in the second quarter after a slump at the start of the year, though growth was revised down slightly last week. Business confidence in Japan remains fragile, with a recent Reuters poll showing sentiment among large manufacturers at a seven-month low in September due to concerns about weak demand from China.
The Bank of Japan is expected to keep its monetary policy steady during a two-day meeting ending on Friday, while also signaling potential future interest rate hikes and highlighting progress towards sustaining inflation around its 2% target.
Minami from Norinchukin noted that while economists generally expect consumption to support Japan's growth, "with little hope for a boost from exports, the momentum of recovery would be weak."
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