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...
Equities hover near record highs while gold suffers its steepest drop in years; traders brace for volatility ahead of Fed meeting
After months of steady gains, the S&P 500’s rally is showing cracks, with investors growing cautious amid buyer exhaustion and a stronger dollar that triggered a historic sell-off in gold and silver.
The S&P 500 ended flat, holding near record territory, while the Dow Jones Industrial Average rose 0.5% on upbeat guidance from 3M Co. The Nasdaq 100 was little changed as traders rotated out of tech stocks following Alphabet’s slide, triggered by OpenAI’s debut of a ChatGPT-powered browser.
Analysts say the market is taking a much-needed pause.
“Our near-term technical outlook is for equities to consolidate or pull back,” said Craig Johnson of Piper Sandler. “We view pullbacks as healthy and necessary.”
A Market Running on Momentum
Despite fears over trade and credit, stock exposure among global macro funds and long-only strategies remains at the highest in more than a year, data from Barclays plc show.
“The path of least resistance continues to lead higher,” said Michael Brown at Pepperstone Group, noting that investors still treat dips as buying opportunities.
Gold and Silver See Rare Collapse
The precious-metals market faced its sharpest correction in half a decade:
Gold fell 5.7% to US$4,107 an ounce,
Silver plunged 7%, as traders locked in profits after an extraordinary multi-month rally.
Analysts cited a mix of positive trade sentiment between the US and China, a stronger dollar, and uncertainty over hedge-fund positioning during the US government shutdown.
“It’s far too early to call the end of the bull market,” said Fawad Razaqzada of City Index. “Corrections are natural. Investors who missed the rally may use this chance to buy the dip.”
Still, volatility has spiked. Gold’s 30-day volatility has outpaced that of the S&P 500 by more than 11 points, a gap seen only once in the past decade — during September 2020.
Investors Shift Toward Dollar and Gold
PineBridge Investments increased its gold and dollar holdings, trimming long-dated bonds on expectations that Treasuries will no longer offer diversification.
“There’s one safety asset left standing, and it’s called gold,” said Michael Kelly of PineBridge, though he acknowledged that short-term swings could remain sharp.
Macro and Earnings Drivers
The S&P 500’s resilience has been underpinned by optimism that US-China trade talks are progressing and solid results from regional banks have calmed credit fears. Goldman Sachs CEO David Solomon said recent bank losses tied to alleged fraud “don’t make a systemic issue.”
Corporate updates were mixed:
Coca-Cola, GE, RTX, Northrop Grumman, and GM all raised outlooks.
L’Oréal and Mattel disappointed.
Warner Bros Discovery is exploring a sale after receiving unsolicited bids.
Adidas lifted forecasts amid strong sneaker demand.
Rates and Commodities
10-year Treasury yield: 3.96% (-2 bps)
Dollar index: +0.3%
Oil: WTI +0.5% to US$57.82 a barrel
Strategist Ed Yardeni predicts that falling oil prices could push yields as low as 3.75% if the Fed eases policy next week, saying cheaper energy will help tame inflation.
Investor Outlook
Volatility is creeping back, but most strategists remain constructive.
“This bull market will keep climbing the wall of worry to finish the year strong,” said Victoria Greene of G Squared Private Wealth.
Joe Tigay of Rational Equity Armor Fund added: “We may grind through more volatility before Halloween, but the setup for year-end looks constructive — especially for tech.”
Bottom line: The S&P 500’s record run is losing momentum, but investors view the current pullback as a breather rather than a breakdown. With earnings resilient, rates easing, and year-end seasonality ahead, markets may yet find another leg higher — though the path will be far bumpier.
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