FX.co ★ Malaysia Bourse Likely To Give Up Support At 1,600 Points

In anticipation of Thursday's Deepavali holiday, the Malaysian stock market resumed its downward trend, following a brief respite after a six-day losing streak where it dropped over 35 points or 2.3%. The Kuala Lumpur Composite Index (KLCI) now barely remains above the 1,600-point mark and is forecasted to open lower on Friday.

The global outlook for Asian markets is predominantly negative, with significant pressure expected among technology stocks due to diminishing optimism regarding interest rate trends. Both European and U.S. markets closed sharply into negative territory, setting an expectation for Asian markets to follow their decline.

On Wednesday, the KLCI recorded a moderate decline, driven by losses in the telecommunications and industrial sectors, while performance in the financial sector was mixed. The index decreased by 13.20 points, or 0.82%, closing at 1,601.88 after fluctuating between 1,601.45 and 1,615.36. Among actively traded stocks, Axiata dropped 2.16%, CelcomDigi fell 2.29%, CIMB Group was down 1.24%, Genting declined 1.00%, and Genting Malaysia decreased 1.75%. In contrast, Hong Leong Bank saw a slight gain of 0.29%, while IHH Healthcare, IOI Corporation, and several other major firms faced various degrees of losses. Notably, Maxis plunged by 4.74%, and Sime Darby saw a significant drop of 5.31%. Conversely, Press Metal and Sunway recorded gains of 0.42% and 0.69%, respectively, while RHB Capital and Petronas Dagangan showed no change.

The outlook from Wall Street is grim, as major indices started on a negative note and failed to recover throughout the trading session. The Dow Jones Industrial Average fell by 378.08 points, or 0.90%, to settle at 41,763.46. The NASDAQ saw a sharp decline of 512.78 points, or 2.76%, concluding at 18,095.15, while the S&P 500 lost 108.22 points, or 1.86%, closing at 5,705.45.

This sell-off on Wall Street was largely influenced by disappointing earnings results from tech giants Microsoft (MSFT) and Meta Platforms (META). Additionally, traders were attentive to consumer price inflation data, which largely matched economist predictions, though core CPI remained steady against lower expectations, fueling concerns that the Federal Reserve might slow the pace of interest rate cuts.

In commodity markets, oil prices increased on Thursday amid projections of rising demand from the U.S. and the possibility of OPEC delaying its planned production increase from December. West Texas Intermediate Crude oil futures for December rose by $0.65, or 0.95%, closing at $69.26 per barrel.