KUALA LUMPUR, Nov 19 (Bernama) -- Bursa Malaysia gave up earlier gains to end mixed today, amid a higher regional market showing, as property, construction, and healthcare counters attracted buying interests, while plantation, banking, and telecommunication stocks saw some profit-taking, an analyst said. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 1.70 points to close at 1,602.34 from yesterday’s close of 1,604.04. The benchmark index, which opened 0.86 of-a-point lower at 1,603.18, moved between 1,601.02 and 1,608.88 during the trading session. However, the broader market was mixed to higher, with gainers leading decliners by 565 to 438 while 502 counters remained unchanged, 961 untraded, and 14 suspended. Turnover narrowed to 2.83 billion units valued at RM2.08 billion versus 2.96 billion units valued at RM2.23 billion yesterday. Rakuten Trade Sdn Bhd equity research vice-president Thong Pak Leng said the benchmark index remained range-bound and it required a dec
Key Takeaway: Japanese and Chinese investors sold a combined $113.2 billion in US Treasuries during Q3 2024, signaling concerns over inflationary policies and geopolitical risks tied to President-elect Donald Trump's impending administration.
Ahead of the US presidential election, Japanese investors sold a record $61.9 billion, while Chinese funds offloaded $51.3 billion of US government debt, according to US Treasury data. The moves came as Treasury yields peaked in September and concerns grew over Trump’s low-tax, high-tariff policies, which are expected to fuel inflation and higher yields.
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Key Drivers Behind the Sell-Off
- Pre-Election Uncertainty:Both countries reacted defensively to election risks, with Japan’s sales driven by fears of a Trump win and China responding to geopolitical tensions.
- Yield Concerns:Treasuries dropped 4% since mid-September due to expectations of higher US yields under Trump’s fiscal policies.
- Currency Interventions:Japan’s sales were partly influenced by its yen-buying intervention in July, where the Ministry of Finance sold $35.9 billion in dollars.
- Custodial Adjustments:China’s net sales were offset by $20.2 billion in purchases via custodial accounts in Belgium, a hub for Chinese Treasury holdings.
Current Holdings and Influence
Despite the sell-off, Japan and China remain major players in the US debt market, holding $1.02 trillion and $731 billion in Treasuries, respectively.
Future Outlook
- Continued Treasury Sales:Analysts like Nick Twidale expect more defensive measures, with China and Japan likely to continue reducing Treasury holdings as Trump’s policies unfold.
- Market Impact:Uncertainty over Trump’s pick for Treasury Secretary and the Federal Reserve’s future rate decisions is contributing to higher yields and ongoing volatility.
The significant Treasury sell-off reflects mounting concerns over the inflationary impact of Trump’s policies and highlights the critical role Japan and China play in shaping the US debt market.
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