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 ...
Key Points
French government bonds are attracting dip buyers after yields spiked on renewed political uncertainty.
The 10-year OAT yield touched 3.55% this week, the highest since March, narrowing the gap with Italian bonds.
The spread vs. German Bunds briefly widened to 82 bps before easing back to ~79 bps.
Amundi CIO Vincent Mortier says spreads are now at levels that “attract marginal buyers,” helping to stabilize the market.
Market Context
The volatility was triggered by Prime Minister Francois Bayrou’s surprise call for a confidence vote on Sept. 8, forcing him to seek either far-right abstentions or a highly unlikely alignment of leftist lawmakers. Political instability has weighed heavily on French assets since last June’s snap elections produced a hung parliament.
Bonds: Investors are reassessing valuations, with yields now at attractive entry points.
Equities: The CAC 40 Index has fallen 3.6% over the past year, underperforming the Stoxx 600 (+5%). Mortier views the recent selloff in parts of the equity market as “too sharp,” creating selective buying opportunities.
Investor Takeaway
Fixed Income: Elevated spreads present a tactical entry point for investors comfortable with political risk.
Equities: Relative valuations now price in much of the political uncertainty, opening the door for contrarian positioning in French stocks.
Amundi’s stance signals that despite political noise, France’s fundamental strengths and fiscal capacity remain intact, providing a cushion for medium-term investors.a
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