KUALA LUMPUR, April 3 (Bernama) -- Bursa Malaysia closed marginally lower on Friday, as cautious sentiment persisted, with investors remaining on the sidelines amid ongoing conflicts in West Asia, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 2.80 points, or 0.16 per cent, to 1,695.50 from Thursday’s close of 1,698.30. The benchmark index opened 5.82 points higher at 1,704.12, and moved between 1,693.65 and 1,708.12 throughout the day. However, market breadth remained positive, with gainers outnumbering losers 634 to 415, while 521 counters were unchanged, 1,077 untraded and 10 suspended. Turnover improved to 3.38 billion units worth RM2.95 billion from yesterday’s 3.20 billion units worth RM3.50 billion.
Asian markets are poised for a rebound after the US signalled a temporary delay in strikes on Iranian energy infrastructure, boosting hopes of de-escalation in the Middle East conflict.
Relief Rally Builds on Softer Geopolitical Tone
Equity futures across the region pointed higher:
- Japan, Hong Kong, and Australia markets set to open stronger
- US markets previously rallied over 1%, providing positive momentum
The shift comes after US President Donald Trump indicated a five-day pause in military action, citing progress in discussions with Iran.
Oil Volatility Remains Key Market Driver
Oil prices remain highly sensitive:
- WTI crude rebounded after plunging more than 10% previously
- The Strait of Hormuz, which handles ~20% of global oil flows, remains central to market risk
Despite the relief, uncertainty persists as Iran denied any negotiations, keeping the outlook fragile.
Rate Expectations Shift as Yields Fall
The easing geopolitical tone has triggered a shift in monetary expectations:
- US bond yields declined sharply
- Markets are now pricing in modest rate cuts later this year
- The US dollar weakened, reflecting reduced safe-haven demand
This marks a reversal from last week’s expectations of potential rate hikes.
Headline-Driven Market Conditions Persist
Analysts caution that markets remain highly reactive:
- Sentiment is driven by geopolitical headlines rather than fundamentals
- Sustained recovery depends on actual progress in diplomacy and oil flows
Any disruption or escalation could quickly reverse gains.
Broader Market Signals Mixed
Other asset movements reflect cautious optimism:
- Silver gained 1.8%
- Bitcoin held above US$70,000
- Gold stabilised after recent sharp losses
Meanwhile, Japan’s strong wage data continues to support expectations of policy tightening by the BOJ.
Investor Takeaways
- Asian equities are set to rebound on signs of temporary de-escalation in the Middle East.
- Oil remains the key variable, with extreme volatility tied to Hormuz developments.
- Rate expectations have shifted, with markets now pricing in potential easing.
- Markets remain headline-driven, with high sensitivity to geopolitical updates.
- Sustainable recovery depends on actual progress in negotiations and stabilisation of energy supply.
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