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...
Key Takeaways
The European Commission has proposed eliminating tariffs on US industrial goods as part of last month’s EU–US trade deal.
In return, Washington reduced tariffs on EU-built cars to 15% from 27.5%, effective Aug 1.
The move avoids a full-blown trade war, though the agreement remains asymmetric, with the EU making broader concessions.
EU proposals also include limited agricultural openings, while maintaining protection on sensitive sectors like beef and poultry.
Deal Structure
The framework deal was struck on July 27 between US President Donald Trump and European Commission President Ursula von der Leyen. The EU accepted a broad 15% tariff across many exports to avert Trump’s threatened 30% blanket duties on EU goods.
While two-thirds of EU–US trade in industrial goods is already tariff-free, Brussels will now remove residual duties averaging 1.35%.
For US farm produce, concessions include zero tariffs on potatoes, reduced tariffs on tomatoes, and quotas for pork, cocoa, and pizza. Sensitive items such as beef, poultry, rice, and ethanol remain excluded.
Asymmetry and Risks
The deal is viewed as asymmetric: Brussels must reduce tariffs and expand US energy purchases, while the US maintains tariffs on 70% of EU exports.
Critical raw materials like steel, aluminium, and copper remain subject to 50% US tariffs.
Digital services were excluded from the agreement, though Trump has threatened tariffs on countries imposing digital taxes.
Market and Political Implications
The EU’s proposal still requires approval from a majority of its 27 member states and the European Parliament, a process that could take several weeks.
While the immediate market impact of tariff removal may be modest given existing low duty levels, the reduction of car tariffs is significant for European automakers.
France and Germany, whose car industries are key exporters to the US, stand to benefit most.
The resolution helps stabilize trade sentiment, but the risk of renewed tensions remains, particularly as Trump continues to pressure on digital taxation and agriculture.
Investor Outlook
For European automakers, lower US tariffs provide relief at a time of slowing global demand and EV transition costs.
Industrial exporters face minimal benefit given already low tariffs, but the broader risk premium on EU–US trade relations may ease.
With US tariffs still weighing heavily on EU steel, aluminium, and other raw materials, producers in these sectors remain exposed.
Political uncertainty persists, as the deal highlights Trump’s transactional approach to trade policy, suggesting investors should remain cautious on long-term stability of transatlantic trade flows.
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