KUALA LUMPUR, Sept 8 (Bernama) -- Bursa Malaysia closed almost flat on Tuesday as buying interest rotated away from index heavyweights towards smaller-cap construction stocks, with sentiment affected by geopolitical uncertainty, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 0.39 of a point to 1,714.40 from Monday’s close of 1,714.79. The benchmark index opened 1.65 points lower at 1,713.14 and moved between 1,710.44 and 1,714.50 throughout the trading session. The broader market was almost evenly balanced, with decliners leading gainers 548 to 546, while 598 counters were unchanged, 1,107 were untraded and 25 were suspended. Turnover expanded to 4.13 billion units valued at RM3.14 billion from 3.60 billion units valued at RM2.45 billion on Monday.
In a world where volatility is the new norm, sovereign wealth funds and central banks — managing a whopping $27 trillion in assets — are pivoting fast. A new Invesco survey reveals they're doubling down on active management and China's tech sector while rethinking currency and asset allocations.
Passive is Out, Active is Back
In an era where predictability is scarce, large institutional investors (> $100B) are embracing active management. Gone are the days when passive investing was a safe bet.
"Predictable is no longer the case," said Rod Ringrow of Invesco.
Key Insight: Active strategies are regaining popularity as funds seek to respond quicker to market swings, geopolitical risks, and innovation shifts.
China: The New Silicon Valley?
Despite rising US-China tensions, nearly 60% of sovereign wealth funds plan to increase allocations to China, especially in tech. In North America, that number jumps to 73%.
Sectors of interest include:
Semiconductors
Cloud Computing
Artificial Intelligence
EVs
Renewable Energy
“There’s a bit of a FOMO now — ‘I need to be in China’,” Ringrow explained.
Strategic Move: Funds now view China’s innovation space with urgency, much like they did with Silicon Valley a decade ago.
Dollar Still Rules, But for How Long?
Although 70% of central banks worry about rising US debt, a dominant 78% still believe the USD will stay top dog for at least 20 years.
Only 11% see the euro gaining ground (down from 20% last year)
Confidence in USD remains despite de-dollarisation chatter
9.4% Return in 2024 – Second Best on Record
Sovereign funds posted nearly 10% returns on average in 2024, despite:
De-globalisation fears
Sovereign debt concerns
Climate change risks
This resilience stems from diversified portfolios and increased exposure to alternative assets.
Private Credit and Crypto Gaining Steam
Wealth funds are ramping up private credit exposure, with:
73% already invested
50% planning to increase allocations
Private credit is viewed as a stable income source amid traditional debt market instability.
On the digital asset front:
75% are eyeing Bitcoin
~50% prefer stablecoins (especially in emerging markets)
Investor Takeaways:
✅ Active management is back — review your ETF-heavy portfolios if markets stay volatile
✅ Watch China — especially AI, semis, EVs. Institutional FOMO may fuel more capital inflows
✅ Alternative assets are rising — private credit and digital assets are no longer fringe
✅ The USD remains king — but US debt may erode long-term confidence
Comments
Post a Comment