KUALA LUMPUR, Dec 5 (Bernama) -- Bursa Malaysia closed lower on Friday amid mixed regional market performance as investors turned cautious over a possible rate hike by the Bank of Japan (BOJ) and upcoming US economic data that may influence the Federal Reserve’s (Fed) interest rate decision next week. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) pared most earlier losses to settle 4.55 points easier, or 0.28 per cent, to 1,616.52 from Thursday’s close of 1,621.07. The benchmark index, which opened 0.37 of-a-point lower at 1,620.70, moved between 1,609.67 and 1,621.25 throughout the day. The broader market was negative, with decliners outpacing advancers 604 to 439. A total of 550 counters were unchanged, 1,151 untraded, and 18 suspended. Turnover declined to 3.17 billion units worth RM2.24 billion from 4.48 billion units worth RM2.75 billion yesterday. Rakuten Trade Sdn Bhd vice-presiden...
Wall Street's major indexes bounced back on Thursday, a day after the Federal Reserve's unexpected hawkish outlook caused sharp market declines. The central bank's updated projections, which include fewer-than-expected interest rate cuts and higher inflation expectations for 2025, caught many investors off guard.
On Wednesday, the Fed revealed it anticipates only two 25 basis point cuts in 2025, a half-point less than its September forecast. Additionally, inflation expectations for 2025 were raised, coinciding with the first year of the new Trump administration. This announcement led to the steepest daily losses in US stocks since August.
Traders are now predicting just one quarter-point rate reduction by mid-2025, compared to prior expectations of three cuts by the end of next year.
Key Market Movements
As of 9:44 am ET:
- Dow Jones Industrial Average: +395.85 points (+0.94%) at 42,722.72
- S&P 500: +52.72 points (+0.90%) at 5,924.80
- Nasdaq Composite: +176.89 points (+0.91%) at 19,569.58
The CBOE Volatility Index, often referred to as Wall Street's fear gauge, dropped to 20.56 points, down from a four-month high of 28.32 reached on Wednesday. Meanwhile, the Russell 2000 index of small-cap stocks climbed 1.3%.
Recovery Highlights
- Tesla (+2%) and Alphabet (+1.7%) led gains among megacap and growth stocks.
- The Dow is poised to end a 10-session losing streak, its longest since 1974.
- The S&P 500 recovered after hitting a near one-month low on Wednesday, reflecting investors' adjustments to higher borrowing costs expected in 2025.
Expert Insights
“The market tends to 'pop after a drop,' but end-of-day profit-taking could limit gains as investors remain cautious heading into the weekend,” noted Sam Stovall, chief investment strategist at CFRA Research.
While the Fed's hawkish approach has cooled investor sentiment, a prolonged period of elevated interest rates may curb inflation, potentially leading to a positive year for markets in 2025, added Stovall.
Economic Data
- US GDP for Q3 was revised upward, indicating faster-than-expected economic growth.
- Weekly jobless claims dropped, suggesting gradual cooling in the labor market.
Stock Specific Moves
- Micron fell 17% due to disappointing quarterly revenue and profit forecasts.
- Accenture surged 7.2% after beating Q1 revenue expectations.
- Lennar, a leading homebuilder, declined 4.5% on weaker-than-expected Q4 results.
- Vertex Pharmaceuticals tumbled 10.2% after its experimental non-opioid pain drug failed to outperform a placebo in a mid-stage trial.
On the NYSE, advancing issues outpaced decliners by a ratio of 2.77-to-1, while the Nasdaq recorded a 2.61-to-1 ratio of advancing to declining stocks. The S&P 500 posted two new 52-week highs and 18 new lows, and the Nasdaq recorded 11 new highs and 66 new lows.
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