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.
Oil prices remained largely unchanged on Tuesday, as concerns about weaker global demand growth overshadowed fears that escalating tensions in the Middle East could disrupt supply from the critical exporting region.
Brent crude futures for December delivery edged up seven cents (0.1%) to US$71.77 a barrel, while US West Texas Intermediate (WTI) crude futures for November delivery gained eight cents (0.12%) to US$68.25.
On Monday, Brent futures closed September down 9%, marking its third consecutive month of declines and the largest monthly drop since November 2022. WTI fell 7% last month and dropped 16% for the quarter.
Market Sentiment Influences Price Stability
"There have been a lot of reservations in place for oil prices, as market participants look towards upcoming supply additions from OPEC+ by the end of this year, alongside a still-soft demand outlook from China reflected in the country’s latest PMI numbers," said Yeap Jun Rong, a market strategist at IG.
Despite this, sentiment appears less sensitive to the weaker data, as hopes for recent stimulus measures may help revitalize the economy. "That said, sentiments have been less sensitive to the weaker data, finding room to stabilize," Yeap noted.
China's manufacturing activity contracted sharply in September, with new orders both domestically and internationally declining, leading to diminished confidence among factory owners, according to a private-sector survey released Monday.
OPEC+ Supply Adjustments and Economic Outlook
Analysts believe that the recent stimulus measures could help China's economy achieve a growth target of about 5% for 2024, despite recent below-forecast data raising concerns about that target. Additionally, OPEC+ plans to increase output by 180,000 barrels per day in December, further influencing supply dynamics.
While tensions in the Middle East continue to be a concern, supply fears remain relatively contained for now. Market participants seem to be pricing out the risks of a wider regional conflict. Israel's anticipated ground invasion of Lebanon commenced early Tuesday, with military operations targeting Hezbollah positions along the border.
U.S. Inventory and Market Projections
In the U.S., crude oil and fuel inventories were expected to have declined by approximately 2.1 million barrels in the week ending September 27, according to a preliminary Reuters poll. The poll results precede a report from the American Petroleum Institute (API) scheduled for release later today.
As the situation unfolds, oil market participants will closely monitor both geopolitical developments and economic indicators to assess future price movements and supply stability.
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