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...
After months of strong gains, US equities paused on Wednesday, with the S&P 500 slipping 0.3% as traders weighed stretched valuations, sticky inflation risks, and labor-market concerns. The index has set nearly 30 records this year, outpacing forecasts, but analysts say momentum is beginning to wane.
Valuations Under Scrutiny
Bank of America’s Savita Subramanian highlighted that on 19 of 20 valuation metrics, the S&P 500 trades at historically expensive levels.
Despite high multiples, Subramanian argued the premium may be justified given improved earnings visibility and economic resilience.
Market Commentary: “Timeout Called”
Strategists are increasingly cautious after a 35% rebound from April’s lows:
Piper Sandler’s Craig Johnson described the latest pause as a “timeout,” with risks skewing near term but the uptrend intact.
Nomura’s Charlie McElligott warned that euphoric AI-driven buying has left investors crowded at high exposure levels, raising downside risk.
Fed, Inflation, and Economic Risks
Fed Chair Jerome Powell noted equity valuations are “fairly highly valued,” though observers saw this as commentary rather than warning.
Sticky inflation remains a concern, with Miller Tabak’s Matt Maley pointing to stagflation fears resurfacing every few months.
Friday’s PCE inflation data is expected to guide sentiment heading into October.
Tech and Corporate Moves
Micron Technology slipped despite an upbeat outlook, after a near-doubling this year.
Intel was reported to be in talks with Apple for investment as part of its turnaround strategy.
Oracle issued US$18 billion in bonds, reflecting robust corporate financing demand.
Historical Perspective
Morgan Stanley’s Daniel Skelly noted bubble talk is rising but premature, with past bull markets averaging eight years versus less than three years for the current cycle.
The S&P 500 forward P/E hit 22.9, levels exceeded only during the dot-com boom and pandemic rally.
Outlook: Consolidation Likely, Rally Intact
UBS Global Wealth Management expects the Fed’s easing cycle to support equities, quality bonds, and gold, projecting the S&P 500 near 6,800 by mid-2026, with a bull case of 7,500.
CFRA’s Sam Stovall said history suggests corrections should be shallow, though volatility is likely as October has historically been the most turbulent month.
Key Takeaway: Wall Street’s rally is stalling, not reversing. With valuations stretched, investors may see near-term consolidation — but longer-term optimism tied to Fed easing and AI-driven growth keeps the bull case intact.
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