• USD gains as tensions escalate, oil prices now above US$100 per barrel

Global Highlights

US dollar – The Dollar Index increased 0.73% to 97.409 as investors continued to flock into the greenback, with the situation between Russia and Ukraine escalating. President Joe Biden is expected to address the country focusing on the economy and Ukraine during the State of the Union later.

US equities – The Dow Jones was down 1.76% to 33,295 points, the S&P 500 1.55% to 4,306, and the Nasdaq shed 1.59% to 13,532 points. The decline in equities was due to investors seeking other alternatives as the situation in Ukraine could escalate even further.

Euro – The euro shed 0.08% to 1.113, continuing its downward trend as the Euro Zone is extremely exposed – economically and militarily – to the escalation in Ukraine.

British pound – The pound lost 0.71% to 1.333.

Japanese yen – The yen ended 0.07% lower at 114.92. On a macro front, Japan’s manufacturing activity growth slowed to a five-month low in February due to Omicron and raw materials shortages.

Chinese yuan – The yuan gained marginally 0.04% to 6.312. The Caixin China General Manufacturing PMI rose to 50.4 in February 2022 from 49.1 in the previous month. The improvement came as output expanded for the third time in the past four months despite extreme measures in keeping Covidcases low. New orders grew the most since last June, and buying activity continued to increase.

Korean won – The won slid 0.21% to 1,199.79. Exports from South Korea grew 20.6% y/y in February 2022. Sales of semiconductors, the nation's top exports, jumped 24% y/y, despite supply bottlenecks and raw materials shortages.

Australian dollar – The Aussie dollar was down 0.15% to 0.725.

Commodities Highlights

Crude oil – Brent increased 3.94% to US$105 per barrel while WTI surged 3.16% to US$107 per barrel.

Gold – Gold prices slightly declined 0.05% to US$1,944/oz.

Malaysia Highlights

Malaysian ringgit – The ringgit gained slightly by 0.15% to 4.193, reflecting some demand on the EM currency at the moment. For the past several days, we have been seeing a strong appetite on Malaysia’s market, particularly from foreign investors.

KLSE – The FBM KLCI down 0.74% to 1,596.

Fixed Income – The local bond market was mixed. The 3-year was down by 0.3bps, 5-year up by 0.1bps, 7-year up by 0.6bps and 10-year up by 0.5bps.

Rates – The IRS for the (3Y) was up 1.0bps to 2.905%, (5Y) 0.2bps to 3.153%, (7Y) remained at 3.350%, and (10Y) 2.0bps to 3.570%. KLIBOR was unchanged at 1.970%.

Against major currencies – The ringgit was higher against the EUR, GBP, AUD, CNY, SGD, THB. IDR, PHP, and VND but lower against the JPY.

Ringgit Outlook for the Day

We expect the MYR to trade between our support level of 4.1930 and 4.1960 while our resistance is pinned at 4.2120 and 4.2150.

Source: AmInvest Research - 2 Mar 2022