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.
For the first time since 1955, Japan’s ruling Liberal Democratic Party has lost its upper house majority, triggering political uncertainty—and the markets felt it.
Key Highlights:
Yen Strengthens
The yen surged as much as 0.7% against the dollar, reacting to the historic loss. Investors often flock to the yen during uncertainty as a safe-haven move.
“Uncertainty usually tends to favor the yen,” said Rodrigo Catril of NAB.
Not Good News for Japanese Assets
With Prime Minister Shigeru Ishiba now needing opposition support to govern, confidence in policy stability has taken a hit.
Expectations of bigger government spending and tax cuts ahead of the election had already pushed bond yields higher.
Market Reaction (So Far):
Nikkei futures: Flat (markets closed Monday for a holiday)
US futures: Flat
Aussie shares: Poised to fall
China stocks: Could edge up
Chinese loan prime rates: Expected to stay unchanged, as PBOC sees no urgency to ease
Why This Matters:
Japan’s political reshuffle could bring policy volatility.
A stronger yen may pressure Japanese exporters.
Investors might reduce exposure to Japanese equities in the short term.
Broader Asian markets may see mixed sentiment as uncertainty ripples.
Investor Tip: Watch how the yen moves over the next few days—sharp strength could reverse quickly, especially if policy clarity improves or if the Bank of Japan steps in.
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