Global Highlights

Dollar Index – The greenback fell 0.69% to 98.404 as the market sought riskier assets. The number of job openings in the US was 11.266 million in February of 2022, little changed from an upwardly revised 11.283 million in January and compared with market expectations of 11 million. But the number of jobs quits remained elevated as it rose to 4.35mil from 4.26mil.

US equities – Wall Street turned green as the Dow Jones rose 0.97% to 35,294, S&P 500 climbed 1.23% to 4,632, while the Nasdaq added 1.84% to 14,620. The UST10-year benchmark yield lost 6.4bps to 2.394%, extending its fall for the second consecutive day.

Euro – The euro surged 0.92% to 1.109 following the latest Eastern European development. Risk-on sentiment recovered as there are hopes surrounding the Ukraine-Russia war in its most recent peace talks in Turkey. Ukraine proposed that it would adopt a neutral status in return for its safety, while Russia pledged to scale down military operations around Kyiv, which marked the most progress made so far to end the war. On the data front, GfK Consumer Climate Indicator in Germany, the biggest economy in Europe, fell to -15.5 for April 2022, the lowest since February of 2021 and weaker than the market consensus of -14, weighed down by the war in Ukraine and inflation.

British pound – The pound inched higher by 0.04% to 1.309. According to local data, consumer credit increased by £1.9 billion in February following a £0.1 billion increase in January and above market expectations of a £0.843 billion rise. It was the biggest rise in consumer credit since March 2017, with a net increase in borrowing in credit cards at £1.5 billion, the highest monthly amount since 1993. This may suggest a cost-of-living crisis before the Ukraine-Russia war.

Japanese yen – The yen recovered some losses from its recent bear-shock. It strengthened 0.79% to 122.88 after hitting the 123 level in the recent bear run. The currency sank after the BoJ announced that it would buy an unlimited amount of the 10-year Japanese government bond (JGB) to keep the rate capped at 0.25%, but immediately rebounded after its finance minister said that the government will carefully watch over the foreign exchange market to avoid a significant weakening of the yen. On the data front, Japan’s unemployment rate was at 2.7% in February 2022, compared with market forecasts and January's figure of 2.8%.

Chinese yuan – The yuan strengthened 0.12% to 6.364 despite lockdowns imposed on certain cities to curb the Covid-19 recent outbreak. According to the US-based China Beige Book survey, the manufacturing sector saw slower growth in the first quarter of 2022, hit by the fresh pandemic restrictions and soft domestic demand.

Commodities Highlights

Crude oil – Oil prices went down, heaved by the possibility of lower oil demand in China due to fresh lockdowns and better prospect of ceasefire talks between Ukraine and Russia. Brent tumbled 2.00% to US$110 per barrel while WTI dropped 1.62% to US$104 per barrel.

Gold – The precious metal declined 0.18% to US$1,919/oz amidst elevated Treasury yields.

Malaysia Highlights

Malaysian ringgit – The ringgit firmed 0.07% to 4.214, retreating from its recent three-month low, and traded within the range of 4.2257 and 4.211 throughout the day. Producer prices in Malaysia rose by 9.7% y/y in February of 2022, compared to a 9.2% growth in the previous month, which was the weakest pace since April 2021.

KLSE – The local bourse fell 0.91% to 1,583, dragged down by the technology and telecommunication & media sectors. Detailed transactions showed that both local retailers and foreign investors were net buyers with RM57.5mil and RM30.7mil, respectively, while offset by the net selling flow of RM88.2mil by local institutions.

Fixed Income – The local bond market saw some recovery, driven by bargain hunters as yields went up, especially on the shorter-terms. The 3-year benchmark MGS yield was -3.0bps to 2.830%, 5-year -4.5bps to 3.550%, 7- year -1.0bps to 3.890%, and 10-year -1.5bps to 3.960%.

Rates – The IRS yield curve shifted lower as well as the (3Y) was -2.0bps to 3.220%, (5Y) -3.5bps to 3.570%, (7Y) -3.0bps to 3.765%, and (10Y) -4.3bps to 3.982%. KLIBOR was unchanged at 1.970%.

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

Ringgit Outlook for the Day

We expect the MYR to trade between our support level of 4.2000 and 4.2030 while our resistance is pinned at 4.2500 and 4.2530

Source: AmInvest Research - 30 Mar 2022