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.
China's consumer inflation eased unexpectedly in September, while producer price deflation deepened, increasing pressure on Beijing to implement further stimulus measures to revive weak demand and faltering economic activity.
The consumer price index (CPI) rose by 0.4% year-on-year, the slowest increase in three months, down from 0.6% in August and below economists’ expectations of another 0.6% rise, according to the National Bureau of Statistics (NBS). At the same time, the producer price index (PPI) fell by 2.8%, marking the fastest decline in six months and further intensifying deflationary concerns.
China's Finance Minister Lan Foan announced that more “counter-cyclical measures” are expected this year, though no specifics on the size or timing were provided. Analysts and investors are eagerly awaiting the upcoming parliamentary meeting, which may outline detailed fiscal stimulus plans aimed at addressing these deflationary pressures.
"China is grappling with persistent deflationary pressure due to weak domestic demand. The shift in fiscal policy would be crucial to managing these issues," said Zhiwei Zhang, chief economist at Pinpoint Asset Management.
Recent measures, including aggressive monetary support from the central bank in late September, have targeted reviving the struggling property sector and boosting the broader economy. However, analysts warn that these steps may offer only temporary relief unless stronger, more decisive actions are taken soon to prevent deflationary expectations from becoming entrenched.
Meanwhile, the core inflation rate, which excludes volatile items like food and fuel, dropped to 0.1% in September, further signaling weak momentum in prices and a growing need for policies that stimulate consumer demand.
As structural issues like industrial overcapacity and sluggish consumption continue to weigh on the economy, China's path to meeting its 5.0% growth target for the year remains uncertain without further fiscal intervention.
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