KUALA LUMPUR: Bursa Malaysia remains under pressure as the global trading landscape grows increasingly volatile, with Treasury yields and oil prices surging amid the escalating Middle East tensions.
"There is a disconnect between extreme equity optimism and elevated rate-hike expectations posing a risk of a sharper correction should either the oil or inflation picture deteriorate further," said Apex Securities in its market outlook.
Overnight, the Dow Jones fell 0.77% while the S&P500 lost 0.48% and the Nasdaq shed 0.64%, even as the Treasury yield climbed to 4.857% after the Treasury department said it would triple its debt buyback operation to US$6bil.
Brent crude futures breached the US$100 a barrel mark to US$101, as hostilities in the Middle East continued.
"We stay cautious on the local bourse in the near term, as persistently elevated oil prices continue to cloud the inflation outlook, with sentiment likely to remain guarded should higher energy costs translate into broader price pressures and raise the prospects of monetary tightening," said Apex.
By sector, the research firm said energy counters may extend their gains as Brent crude climbed above US$100 per barrel amid escalating West Asia tensions.
Plantations could also see some interest, with higher oil prices lending indirect support to CPO prices.
Conversely, REIT and Property may continue to stay under pressure as inflation concerns and tighter monetary policy prospects weigh on sentiment.
At 9.15am, the FBM KLCI was down 4.88 points to 1,709.46. Leading decliners included IHH falling six sen to RM7.86, Telekom down 11 sen to RM8.07 and PPB sliding five sen to RM9.60.
Of active stocks, Zetrix AI slid one sen to 26 sen, Ni Hsin
dove 9.5 sen to 20.5 sen and MAG was flat at 15.5 sen.
