KUALA LUMPUR, Jan 28 (Bernama) -- Bursa Malaysia snapped its five-day winning streak to close lower on Wednesday, as investors took profit following a cumulative gain of 4.25 per cent over the past five sessions, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) fell 14.76 points or 0.83 per cent to 1,756.49 from Tuesday’s close of 1,771.25. The market bellwether opened 1.46 points lower at 1,769.79, marking the day’s high, and hit a low of 1,750.05 during the mid-afternoon session. Market breadth was negative with losers trouncing gainers 876 to 384, while 525 counters were unchanged, 964 untraded and 94 suspended. Turnover improved to 3.65 billion units worth RM4.41 billion from Tuesday's 3.58 billion units worth RM4.46 billion.
Japan’s latest 40-year government bond sale delivered stronger-than-average demand, offering temporary relief to markets after weeks of sharp volatility in long-term yields.
Quick Summary
40-year bond auction beat demand expectations
Yields eased after last week’s record spike
Election-driven fiscal concerns remain unresolved
More volatility likely in bonds and yen markets
What Happened
The bid-to-cover ratio came in at 2.76, above the previous auction (2.585) and the 12-month average of 2.53
The 40-year yield fell 3.5 basis points to 3.9% after the auction
Demand eased immediate fears over Japan’s long-term debt, though uncertainty remains elevated
Why This Matters
The auction followed a turbulent week in Japanese bond markets, triggered by fiscal and political shocks:
Long-dated yields spiked to record highs after Prime Minister Sanae Takaichi proposed a two-year removal of food sales tax
Forty-year yields surged over 25 basis points, peaking at 4.215%, the highest since issuance
Although yields have since pulled back, volatility risks remain high
Politics Are Driving Market Anxiety
Japan heads toward a Feb. 8 snap election
The opposition Centrist Reform Alliance has pledged a permanent food tax cut
Investors fear weaker fiscal discipline regardless of election outcome
At the same time, policymakers at the Bank of Japan are watching the yen’s depreciation, which could complicate inflation dynamics.
Yen Moves Add Another Layer
The yen touched its strongest level since October after comments from Japanese officials hinted at possible FX intervention
A weaker dollar also helped, after Donald Trump signaled comfort with dollar declines
Japan’s finance minister warned the government stands ready to act amid weak yen and rising bond yields
What’s Next
The Ministry of Finance will auction 10-year and 30-year bonds next week
Those sales will be a key test of investor appetite for long-dated Japanese debt
Markets are bracing for continued rate and FX volatility ahead of the election
Bottom Line
Strong demand at the 40-year auction has eased near-term stress, but Japan’s bond market remains hostage to politics, fiscal uncertainty, and currency risks. The calm may prove temporary as investors look to upcoming bond sales and the snap election for direction.
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