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...
Fed’s Policy Pivot Lifts Sentiment
Asian equities climbed Monday, buoyed by growing conviction that the U.S. Federal Reserve will resume rate cuts in September. Futures now price in an 84% probability of a 25bps cut and as much as 100bps of easing by mid-2026, bringing the Fed funds rate into the 3.25%–3.50% range.
Treasuries & Dollar: Yields fell sharply on Friday, with the U.S. 10-year note at 4.263%, down 7bps. The dollar weakened, supporting risk assets.
Market implication: Lower borrowing costs improve the earnings outlook, but also signal Fed concern over slowing employment and growth.
JPMorgan’s Bruce Kasman warned that while easing is supportive, risks remain skewed toward a downshift in global growth.
Inflation in Focus – Data Could Test Euphoria
The rally faces an immediate test from Friday’s release of the U.S. PCE index, the Fed’s preferred inflation gauge. Core inflation is expected to rise to 2.9% (highest since 2023), with tariff-related pressures potentially pushing the annualized rate toward 4%.
Upside risk: A hotter reading could reverse bond gains and challenge equities, especially with US$183 billion in new Treasury supply this week.
Regional Market Snapshot
Japan Nikkei: +0.8%
South Korea KOSPI: +0.7%
Australia ASX: +0.9%
MSCI Asia ex-Japan: +0.4%
Meanwhile, EUROSTOXX 50 and DAX futures were flat, while S&P 500 and Nasdaq futures held steady after Friday’s strong gains.
Nvidia Earnings – The Market’s Next Catalyst
Investor focus now shifts to Nvidia’s earnings Wednesday. Street forecasts call for:
EPS growth: +48% YoY
Revenue: US$45.9B (Q2 FY25)
With a US$4 trillion market cap, Nvidia’s results could swing shares by ~6% in either direction based on options pricing, potentially setting the tone for global tech sentiment.
Key watchpoints:
Outlook for China shipments amid U.S. restrictions.
Details of the Trump administration deal requiring Nvidia to pay 15% of certain China sales to the U.S. government.
Competitive backdrop, with Trump also announcing a 9.9% U.S. stake in Intel (US$8.9B purchase at US$20.47/share), below market price.
Currency & Commodities
FX: USD/JPY at ¥147.28 (down 1% from Friday’s 148.77 high). EUR/USD at 1.1702.
ECB outlook: Rates likely steady in Sept, though cuts may return to discussion later this year.
Gold: US$3,365/oz (+1%).
Oil: Supported by ongoing Russia-Ukraine tensions and sanctions constraining supply.
Key Takeaways for Investors
Fed Cut Expectations Driving Risk-On: Strong market rally priced in; watch PCE inflation data for confirmation.
Nvidia Earnings Critical: Results and China sales outlook could swing broader tech valuations.
Rotation Watch: Dollar weakness is boosting commodities; gold and oil remain supported.
Macro Risks Persist: Treasury supply and sticky inflation could cap gains; global growth concerns remain in focus.
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