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...
Eight months into Donald Trump’s presidency, global markets have been hit with one shock after another — steep tariff threats, an attempted shakeup of the Federal Reserve, and even moves toward US-style state capitalism. Yet instead of tumbling, stocks are at fresh highs, bonds are steady, and growth has kept chugging along.
For retail investors, the big question: Is this resilience real, or just the calm before the storm?
Why Markets Are Holding Up
Economists at BNP Paribas point to a few key cushions:
Easy financial conditions – Rates are still low, liquidity remains strong.
Healthy balance sheets – Households and corporates aren’t overleveraged.
AI-driven productivity – Optimism around tech investment is offsetting risks.
Lower energy costs – Keeping inflation fears in check.
On trade, the nightmare scenario of a global tariff war hasn’t materialized. Instead, the US struck limited deals with Europe and Asia. Tariffs are higher, but the costs are being shared across exporters, importers, and consumers — painful, but not catastrophic.
Fed Drama Contained… For Now
Trump’s attempts to pressure the Fed — including failed moves to oust Jerome Powell and fire Governor Lisa Cook — have rattled headlines but not markets.
The US 10-year Treasury yield has eased from 4.6% at Trump’s inauguration to ~4.1% today.
The Fed even cut rates by 25 bps this week, signaling confidence inflation is under control.
Powell downplayed Trump’s attacks, saying markets aren’t pricing in political risks just yet.
Global Bright Spots
China: Left rates steady as exports and stocks show resilience.
Eurozone: ECB raised its 2025 GDP forecast to 1.2% (from 0.9%).
Spain: Growth upgraded to 2.6%, led by tourism.
Italy: Cleaning up finances, eyeing a Fitch ratings bump.
Germany: Growth could rebound strongly from 2026, fueled by fiscal stimulus.
Japan: Business sentiment at 3-year highs.
Emerging Markets: Brazil, Mexico, and India benefiting from a weaker US dollar.
The Risks Beneath the Surface
Not everything is rosy. Analysts warn:
Tariff effects take time – Japan and Germany already show early export weakness.
Complacency in markets – Investors may be betting too much on a “Fed put.”
US growth imbalance – AI and wealthy consumers drive gains, while housing and jobs lag.
Policy overhang – Trump’s push into universities, R&D cuts, and government stakes in firms could weigh on long-term productivity.
Janus Henderson’s Oliver Blackbourn cautions: “The US labor market weakness should have everyone on a hair trigger for recession.”
Investor Takeaway
Global markets are climbing a wall of worry. Equity indices and risk assets keep making new highs, but many fund managers admit they’re uneasy.
As Ninety One’s Alan Siow notes: “This was always going to be a long, long tail adjustment… Market levels might not reflect underlying realities.”
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