KUALA LUMPUR: Bursa Malaysia reversed its early gains to close lower today, reflecting weak regional sentiment following negative cues from global equities overnight.
At 5pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) slid 10.82 points to close at 1,600.68 from yesterday's close of 1,611.50.
The benchmark index, which began the day 3.39 points higher at 1,614.89, fluctuated between 1,598.64 and 1,615.84 throughout the trading session.
On the broader market, decliners outnumbered gainers 586 to 419, while 543 counters were unchanged.
Turnover rose to 3.14 billion units valued at RM2.69 billion versus 2.82 billion units worth RM2.22 billion yesterday.
SPI Asset Management managing director Stephen Innes said with President Donald Trump's anticipated tariffs looming like storm clouds, markets are bracing for impact, and Asean equities are feeling the tremors.
He added that for Malaysia's trade-dependent economy, this creates a challenging landscape, as concerns over US policy changes keep markets on tenterhooks.
Innes also noted that tomorrow's third-quarter (Q3) gross domestic report (GDP) report might just be the make-or-break moment, holding the potential to either soothe or shake up investor sentiment.
"While the market is braced for a moderate 5.3 per cent growth - slightly down from Q2's pace - a stronger reading could provide a much-needed boost, possibly flipping today's cautious tone into something more optimistic.
"But a lacklustre result would likely only intensify jitters, reinforcing the current bearish vibe as investors grow wary of further capital outflows," he told Business Times.
He also said with the US dollar's relentless rise and trade tensions simmering, Malaysia's markets are entering a high-stakes game where each data point and US policy decision could tip the scales, where the latter via the China tarrif route looms ominous.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid believes that foreign interest on Malaysian market will make a come back once the external uncertainies are cleared in early next year when Trump administration will commence their policy making and implementation.
He noted that market sentiments have been uneasy over Trump 2.0 and how that would play out in respect to Fed's monetary policy.
"Nevertheless, the US economy is in good shape and Trump has gained significant political capital.
"It would be unwise for his administration to enact something that could compromise the growth trajectory," he noted.
On the outlook for the market ahead of tomorrow's 3Q GDP announcement, Afzanizam said the result is expected to be close to the advance estimates.
He noted that the market has already factored this in.