US-Iran Talks Lift Sentiment Despite Lingering Market Caution

KUALA LUMPUR: Investor sentiment improved cautiously across global markets amid growing optimism over ongoing United States-Iran negotiations, although uncertainty surrounding the outcome continued to weigh on trading activity.

The FBM KLCI slipped 0.24 per cent to close at 1,708.50 on Monday as investors remained cautious ahead of the final stretch of the corporate earnings season. Market breadth stayed negative, with 630 decliners outnumbering 442 gainers.

Technology stocks led gains locally, rising 1.37 per cent, followed by Transportation & Logistics and Financial counters. Industrial Products, REITs and Telecommunications & Media emerged as the main laggards.

Market Caution

Regional sentiment improved after crude oil prices fell 7.6 per cent to US$96.30 per barrel following signs of progress in US-Iran peace negotiations, raising hopes for an eventual reopening of the Strait of Hormuz.

United States President Donald Trump said discussions with Iran were “proceeding nicely” but warned military action could resume if negotiations failed.

European markets advanced strongly, with the STOXX Europe 600 Index climbing 1.04 per cent to its highest level in more than two months. In Asia, Japan’s Nikkei 225 rose 2.87 per cent as optimism over easing geopolitical tensions boosted risk appetite.

Analysts expect the FBM KLCI to trade firmer on Tuesday, supported by improved regional sentiment, easing oil prices and continued interest in AI-related technology counters.

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