KUALA LUMPUR, Dec 12 (Bernama) -- Bursa Malaysia’s key index closed higher today on bargain hunting, in line with positive investor sentiment across regional markets, consolidating at its highest level in more than two months — a level last seen on Oct 2, 2025. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 12.42 points, or 0.76 per cent, to 1,637.81, compared with Thursday’s close of 1,625.39. The benchmark index opened 2.83 points lower at 1,622.56, thereafter edged down to an early low of 1,622.03, before staging an uptrend to an intraday high of 1,640.36 in late trading. Market breadth was positive, with gainers trouncing decliners at 743 versus 387. Another 530 counters were unchanged, 1,108 untraded, and 16 suspended. Turnover increased to 3.09 billion units worth RM2.46 billion from 2.99 billion units worth RM2.35 billion on Thursday. Rakuten Trade Sdn Bhd vice-president of equity research Thong Pak Leng said the FBM KLCI ended higher on continued...
Key Takeaway: After a powerful US$16 trillion surge since April, Wall Street paused for breath as traders took profits and valuations came under scrutiny.
Market Recap
| Index | Latest | Change |
|---|---|---|
| S&P 500 (.SPX.US) | 6,715 | -0.38% |
| US 10-Year Treasury Yield | 4.13% | -3 bps |
| US Dollar | — | Higher |
The S&P 500 slipped from record highs, led by weakness in large-cap technology names.
Oracle (ORCL.US) dropped 2.5% after reports of lower cloud margins.
Tesla (TSLA.US) fell more than 4% after unveiling lower-priced Model 3 and Model Y versions.
- Dell Technologies (DELL.US) rose 3.5% after raising forecasts on strong AI-driven demand.A US$58 billion Treasury auction drew solid demand, pushing bond prices higher.
Rally Fatigue After a US$16 Trillion Surge
A strong run since April, driven largely by AI optimism, is showing signs of exhaustion. Sentiment indicators from Goldman Sachs, Barclays, and Bloomberg Intelligence all suggest that investor enthusiasm has reached extreme levels.
“A period of consolidation would not come as a surprise after such a strong run, but the rally is still supported by solid fundamentals,” said Ulrike Hoffmann-Burchardi of UBS Global Wealth Management.
Analyst Views
Chris Montagu, Citigroup: Profit-taking risk has risen sharply, especially for Nasdaq components.
Craig Johnson, Piper Sandler: Diverging momentum suggests a brief pullback could improve market positioning.
Mark Newton, Fundstrat: Overbought conditions are not necessarily bearish; strength can persist longer than expected.
Callie Cox, Ritholtz Wealth Management: Elevated valuations now need to be justified by earnings growth; rebalancing may be prudent.
Louis Navellier, Navellier & Associates: The current rally is not a dot-com bubble; AI leaders today have strong balance sheets and cash flow.
Navellier cautioned, however, that any disappointment in AI profitability could weigh heavily on index-heavy tech names.
Fed and Macro Developments
Federal Reserve Governor Stephen Miran said that limited tariff impacts on inflation would allow the Fed to continue easing policy. In contrast, Minneapolis Fed President Neel Kashkari warned that overly aggressive rate cuts could reignite inflation pressures.
JPMorgan CEO Jamie Dimon said the bank spends about US$2 billion annually on AI development and saves roughly the same, calling it “the tip of the iceberg” for efficiency gains.
Market Perspective
BMO Capital Markets strategists Ian Lyngen and Vail Hartman noted that the decline was not a sign of panic but rather profit-taking in the tech sector following narrow-margin concerns in AI-related cloud services.
They added that the Treasury market remains stable and used the equity pullback as an opportunity to rally.
Outlook
The recent pullback appears to be a consolidation phase rather than the start of a major correction. Analysts suggest investors stay selective, focusing on earnings delivery and valuation discipline as the next drivers of market direction.
In summary: After a US$16 trillion surge, the market is cooling but not cracking. Fundamentals remain intact, though investors may face a more volatile consolidation period ahead.
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