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.
Key Takeaway: Asian equities advanced Tuesday, tracking Wall Street gains on rising expectations of U.S. Federal Reserve rate cuts, while investors weighed political shifts in Japan and Indonesia, and weaker trade data from China.
Regional Market Performance
The MSCI Asia-Pacific equities index touched its highest level since February 2021, driven by gains in Japan and South Korea. In Tokyo, the Topix rose 0.7%, while Australia’s S&P/ASX 200 slipped 0.5%. Futures pointed lower in Europe, with the Euro Stoxx 50 down 0.2%.
Markets are taking their cue from the U.S., where optimism about imminent Fed easing boosted sentiment. “For the next several days, markets in Asia are likely to take their cue from the US, with few regional catalysts in sight,” said Frederic Neumann, HSBC’s chief Asia economist.
U.S. Market Context
The S&P 500 rebounded on Monday, alongside modest gains in the Dow Jones Industrial Average (+0.25%) and the Nasdaq Composite (+0.45%). Traders are nearly certain the Fed will cut rates this month, pricing in close to three cuts by year-end.
Treasuries held steady, with the two-year yield at its lowest since 2022. The dollar weakened, while gold hovered near record highs.
Upcoming data will be pivotal:
Tuesday: Bureau of Labor Statistics revisions to jobs data
Thursday: August core CPI expected to rise 0.3% for a second consecutive month
Political and Economic Developments
Japan: Political turmoil deepened after Prime Minister Shigeru Ishiba announced plans to step down, raising expectations for looser fiscal policy. Long-dated Japanese government bonds fell on Monday, though the 10-year yield eased 2.5 bps to 1.545% on Tuesday.
Indonesia: President Prabowo Subianto abruptly dismissed Finance Minister Sri Mulyani Indrawati, heightening concerns of financial instability after recent protests.
China: Exports slowed to their weakest pace in six months, dragged by declining U.S. shipments. Still, resilient sales to other markets kept Beijing on course for a record trade surplus.
France: Prime Minister Francois Bayrou lost a parliamentary confidence vote, forcing the nation’s third government change in just over a year.
Currencies and Cryptocurrencies
Bloomberg Dollar Spot Index: Little changed
Euro: US$1.1772 (flat)
Yen: +0.2% at 147.21 per dollar
Offshore yuan: 7.1203 per dollar (steady)
Bitcoin: –0.2% at US$111,810
Ether: +0.2% at US$4,306
Bonds and Commodities
U.S. 10-year yield: 4.04% (flat)
Australia 10-year yield: –3 bps at 4.25%
WTI crude: +0.3% at US$62.44 a barrel
Spot gold: little changed, near record highs
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