KUALA LUMPUR, Dec 16 (Bernama) -- Bursa Malaysia extended its positive performance, closing higher for a fourth consecutive session, supported by improving local market sentiment underpinned by a firm domestic macroeconomic backdrop. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 4.59 points, or 0.28 per cent, to 1,648.31, from Monday’s close of 1,643.72. The index had opened 0.95 of a point lower at 1,642.77, and moved between 1,636.50 and 1,648.71 throughout the trading session However, on the broader market, decliners beat gainers 699 versus 408. A further 520 counters were unchanged, 1,149 untraded and 12 suspended. Turnover rose to 2.59 billion units worth RM2.27 billion from 2.50 billion units worth RM2.16 billion on Monday.
US stocks rebounded sharply on Monday as investors bought into the market’s steepest rally since May, fuelled by renewed optimism over US-China trade talks, easing Middle East tensions, and continued enthusiasm around artificial intelligence.
S&P 500 Posts Best Session in Five Months
The S&P 500 surged 1.6%, adding to a bull market that has already lifted valuations by US$28 trillion (RM118.4 trillion).
Chipmakers led the rally — a sector index climbed nearly 5%, driven by Broadcom Inc’s 10% jump after OpenAIsigned a multiyear deal to buy its custom chips and networking equipment.
Analysts said the rebound demonstrated that “buy-the-dip” sentiment remains entrenched, even as valuations stretch.
“Investors remain eager for exposure, and if this recovery holds, it reinforces the idea that retail investors can’t be easily shaken,” said Mark Hackett, Nationwide.
Trade and Geopolitical Relief Lift Sentiment
Markets gained after signals that both Washington and Beijing were open to reviving trade negotiations.
At the same time, President Donald Trump’s visit to the Middle East — where he celebrated a ceasefire deal between Israel and Hamas — helped calm geopolitical concerns.
The US dollar rose 0.2%, while Treasury futures were steady with the bond market closed for Columbus Day.
Bull Market Marks Third Anniversary
The rally coincides with the third anniversary of the current bull market — now one of the fastest and strongest on record.
According to LPL Financial, bull markets that extend into a fourth year have averaged 12.8% annual gains since 1950.
“We think the bull market will remain intact,” said Ulrike Hoffmann-Burchardi of UBS Global Wealth Management.“Pullbacks should offer an opportunity for investors who are underallocated to equities to add long-term exposure.”
The S&P 500’s trailing price-to-earnings ratio now stands at 25, the highest for any bull market in its third year, according to CFRA.
Earnings Season Looms as Next Test
Investors are now turning their attention to third-quarter corporate results, beginning with major banks this week.
Analysts warn that momentum in profit expectations is fading — Citigroup’s earnings revision index has turned flat for the first time since August.
“If strong sentiment from the last earnings season can’t be sustained, major indices may enter a brief period of digestion,” said Lori Calvasina, RBC Capital Markets.
Key themes this season include AI spending profitability, tariff impacts, and corporate margin resilience.
“Investors will closely examine tech earnings as AI and data center capex is increasingly being questioned in terms of profitability,” said Richard Saperstein, Treasury Partners.
Bottom Line:
Despite a slowdown in earnings momentum, the market’s three-year bull run remains intact, underpinned by resilient economic growth and easing policy conditions. Analysts suggest a “cautiously optimistic” stance heading into year-end — with fundamentals, not fear, driving the next phase of gains.
Comments
Post a Comment