KUALA LUMPUR, July 30 (Bernama) -- Bursa Malaysia's key index closed at an intraday high today, supported by continued buying interest even as renewed geopolitical tensions and a weaker overnight lead from Wall Street following the US Federal Reserve's (Fed) decision to stand pat on interest rates weighed on broader sentiment. The Fed has decided to hold rates steady for the fifth consecutive meeting, with the Federal Funds Rate unchanged between 3.50 per cent and 3.75 per cent. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 4.84 points to 1,720.40 from yesterday’s close of 1,715.56. The benchmark index, which opened 1.14 points lower at 1,714.42, hit its lowest level of 1,710.69 in early trade before gaining momentum for the rest of the day. However, the broader market was negative with losers outpacing gainers 581 to 411, while 612 counters were unchanged, 1,173 untraded, and 87 suspended. Turnover declined to 2.49 billion units valued at RM2.25 billion from ...
Oil prices edged higher Thursday after OPEC+ delayed unwinding production cuts for the second time, aiming to stabilize the market amid global oversupply and sluggish demand from China.
Market Reaction
- WTI crude (January): +$0.35 (0.5%) to $68.89/bbl.
- Brent crude (February): +$0.53 (0.7%) to $72.84/bbl.
- Natural gas (January): +2.3% to $3.115/MMBtu.
The production cuts, initially planned for January, will now begin in April 2025. Full implementation is pushed back to September 2026, marking a slower unwinding pace than earlier planned.
Expert Insights
David Oxley, Capital Economics:
- Delaying production increases buys OPEC+ time but doesn’t resolve weak global demand.
- Risks to oil prices remain skewed downward.
Robert Yawger, Mizuho Securities:
- OPEC+ appears to wait for Chinese demand recovery, a strategy that could take time.
Jefferies Analysts:
- OPEC+ is unlikely to boost supply until the market can absorb it, especially without a reduction in Iranian exports.
Broader Context
- OPEC+ Strategy: Members face internal pressure to increase production for short-term gains, particularly following expectations of higher U.S. shale output after Donald Trump’s election win. Saudi Arabia continues to maintain tight production levels.
- Iran Sanctions: The U.S. imposed sanctions on entities tied to Iranian oil exports, potentially limiting global supply.
- Natural Gas: U.S. inventories fell by 30 billion cubic feet last week, slightly less than expected, keeping gas futures stable.
Outlook
While OPEC+ aims to stabilize prices by delaying production increases, analysts warn of lingering uncertainties. Weak global demand and potential oversupply in 2025 could challenge their efforts to keep prices steady, particularly if Iranian exports remain high.
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