Volatile Trade Expected For FBM KLCI Futures Next Week

By NurulJannah Kamaruddin

KUALA LUMPUR, Nov 2 (Bernama) -- The FTSE Bursa Malaysia KLCI (FBM KLCI) futures contract on Bursa Malaysia Derivatives is expected to trade in volatile mode next week ahead of the United States (US) Presidential election.

Nevertheless, UOB Kay Hian Wealth Advisors head of investment research Mohd Sedek Jantan said the Federal Open Market Committee (FOMC) meeting on Nov 6-7 is anticipated to provide a stabilising influence amid any election-driven volatility. 

“While the election outcome will likely shape the US market sentiment, we expect minimal direct impact on Malaysian markets, as local investors have largely taken a cautious stance.

“Consequently, a wait-and-see approach may dominate trading, with investors in Malaysia watching Wall Street’s reaction closely and considering the implications for the US economic policy,” he said.

The current market consensus expects a 25-basis-point rate cut, lowering the federal funds rate to 4.50-4.75 per cent.

This decision would reflect easing inflation towards the US Federal Reserve’s 2.0 per cent target and a slight rise in the US unemployment rate, which indicates a softening labour market.

Rakuten Trade vice-president of equity research Thong Pak Leng anticipates the recent pullback, in which the FBM KLCI dipped below the key support level of 1,600, to present an appealing entry point for both short-term and long-term investors.

He also expects continued interest in plantation counters amid a rally in crude palm oil prices.

For the week just ended, the spot month November 2024 contract and December 2024 slipped 15.5 points to 1,605.0 and 1,608.0, respectively.

March 2025 contract fell 14.5 points each to 1,596.5, while newly introduced June 2025 settled at 1,595.0.

Turnover soared to 243,353 lots from 64,552 lots in the previous week, while open interest fell to 42,202 contracts from 74,284 contracts previously.

On a Friday-to-Friday basis, the FBM KLCI fell 14.32 points to 1,603.98 from 1,618.30 in the previous week.

-- BERNAMA