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...
China’s factory activity unexpectedly deteriorated in July, with the official manufacturing PMI dropping to 49.3 from June’s 49.7, marking its weakest reading in three months and signaling a contraction despite the recent tariff truce with the US. The figure missed economists’ median forecast of 49.7, raising fresh concerns over the durability of the country’s economic momentum.
Key Data:
Manufacturing PMI: 49.3 (vs. 49.7 in June; est. 49.7)
Non-Manufacturing PMI: 50.1 (vs. 50.5; est. 50.2)
Construction Input Prices: 54.5 (vs. 48.3), driven by rising steel and building material costs.
Market Reaction:
CSI 300 Index: Down ~1% after the release.
China Government Bonds: Futures rose as investors sought safety.
Drivers Behind the Slowdown:
Weak Exports: Early signs that shipments are slowing despite front-loading ahead of tariffs.
Soft Domestic Demand: Consumer spending remains tepid amid persistent uncertainty.
Seasonal & Weather Disruptions: NBS cited high temperatures, heavy rain, and flooding impacting production during July’s “traditional off-season.”
Broader Implications:
The latest PMI highlights the fragility of China’s recovery as the world’s second-largest economy faces headwinds from global trade tensions and muted domestic consumption. Cargo throughput at ports dropped nearly 7% week-on-week, signaling potential softening in trade.
While commodity prices like iron ore and coal have risen on policy hopes and infrastructure demand — including a 1.2 trillion yuan hydropower project in Tibet — deflationary risks linger. A central bank survey revealed Chinese households are increasingly pessimistic, with job market sentiment at record lows.
Outlook:
Despite strong first-half performance surpassing the annual growth target of ~5%, the PMI contraction raises the risk of a more pronounced slowdown in the second half of 2025. Policymakers may be pressed to accelerate stimulus and bolster domestic demand to cushion the impact of global trade uncertainty.
Comments
Post a Comment