Market Pulse - End Of Low Interest Rate Environment

The FBM KLCI rebounded with the bargain hunting activities in the plantation and banking sector; the latter propelled following the BNM’s announcement to increase the overnight policy rate by 25 basis points. We believe investors should brace for heightened volatility across global markets as Wall Street tumbled overnight in anticipation on a faster pace of interest rate hike and potential further tightening in monetary policies after the higher-than-expected inflation data was released. Nevertheless, recovery-themed and commodities related sectors may be favourable ahead of the quarterly reporting season.