5 min read I Date: 11 November 2025
Market Data
| Asset Class | Currency | 1-wk | 1-mth | YTD | 2024 | |
| Equities | ||||||
| MSCI World | USD | -1.5% | -0.2% | 16.6% | 17.0% | |
| S&P 500 | USD | -1.6% | 0.2% | 14.4% | 23.3% | |
| Nasdaq | USD | -3.1% | 0.9% | 19.2% | 24.9% | |
| Russell 2000 | USD | -1.9% | -1.1% | 9.0% | 10.0% | |
| Stoxx 600-Europe | EUR | -1.2% | -0.8% | 11.3% | 6.0% | |
| Nikkei 225 | JPY | -4.1% | 4.1% | 25.9% | 19.1% | |
| MSCI Asia Pac ex-Japan | USD | -1.5% | -0.4% | 25.4% | 7.6% | |
| ASEAN | USD | 0.5% | -1.6% | 10.6% | 7.7% | |
| Shanghai Shenzhen CSI 300 Index | CNY | 0.8% | 0.9% | 19.0% | 14.7% | |
| Hang Seng Index | HKD | 1.3% | -2.8% | 31.0% | 17.5% | |
| Shanghai Stock Exchange Composite Index | CNY | 1.1% | 2.9% | 19.3% | 12.7% | |
| FBMKLCI | MYR | 0.5% | -2.1% | -1.4% | 12.8% | |
| Fixed Income | ||||||
| Bberg Barclays Global Agg Index | USD | -0.1% | 0.0% | 7.6% | -1.7% | |
| JPM Asia Credit Index-Core | USD | -0.1% | 0.6% | 8.4% | 6.0% | |
| Asia Dollar Index | USD | -0.4% | -0.7% | 2.2% | -4.1% | |
| Top Performing Principal Funds | ||||||
| Equities | 1-mth as of (30 October 2025) | YTD as of (30 October 2025) | ||||
| Principal Biotechnology Discovery USD | 12.53 | 37.62 | ||||
| Principal Islamic Asia Pacific Dynamic Equity MYR | 9.87 | 17.97 | ||||
| Principal DALI Global Equity MYR | 9.60 | 20.56 | ||||
| Balanced | ||||||
| Principal Asia Pacific Dynamic Mixed Asset MYR | 4.20 | 12.30 | ||||
| Principal Heritage Balanced MYR Hedged | 3.56 | 13.24 | ||||
| Principal Emerging Markets Multi Asset USD | 3.43 | 21.93 | ||||
| Fixed Income | ||||||
| Principal Islamic Global Sukuk USD | 0.50 | 5.34 | ||||
| Principal Lifetime Bond | 0.33 | 4.62 | ||||
| Principal Deposit | 0.27 | 2.94 |
Source: Bloomberg, market data is as of 7 November 2025.
*As we emphasise a long-term focus, the top performing funds were selected based on monthly performance.
*The numbers may show as negative if there is no positive return for the period under review.
*The fund performance was referenced from the daily performance report, data was extracted from Lipper.
*The performance figures are based on the fund’s respective currency class.
*Past performance is not an indication of future performance.
Market Review1
- This week, global financial markets showed mixed performance. In developed market, Japan led the declines, followed by the United States and Europe.
- Across Asia, markets exhibited mixed performances. Indonesia led the way with the largest gain, while South Korea experienced losses. In Malaysia, the FBMKLCI ended the week with a marginal gain.
- In the bond market, the yield on the 10-year US Treasury showed little changed, hovered around the 4.00%, range as investors continued to face an economic data blackout amid the U.S. government shutdown. (It’s worth noting that bond prices move inversely to bond yields.)
Macro Factors
- In the United States, market sentiment was tempered by mixed comments from Fed officials and a hawkish tone from Chair Powell last week. The probability of a 25bps reduction in the fed funds rate next month currently stands at around 63%, down from nearly 90% before the latest FOMC decision last week. Economic data also lent support to the greenback, with the ADP report signalling stabilization in the labor market after two months of job losses and the ISM services PMI rising to an eight-month high. However, the ongoing government shutdown which is now the longest in US history, continues to delay the release of key public data.2
- In Europe, policy outlooks diverged between the European Central Bank and the US Federal Reserve. The ECB is expected to keep rates unchanged for some time, with money markets now pricing only a 45% chance of a rate cut by September 2026, down sharply from over 80% in October. Meanwhile, Eurozone retail sales fell 0.1% month-on-month in September 2025, marking a third straight month of contraction or stagnation and missing expectations for a 0.2% increase.3
- In China, authorities recently mandated that new data canter projects receiving state funding must exclusively use domestically produced AI chips, reinforcing the country’s push for tech self-sufficiency. The RatingDog China General Manufacturing PMI fell to 50.6 in October 2025 from September’s six-month high of 51.2, falling short of the market consensus of 50.9. The moderation in factory activity was driven by slower growth in both new orders and output. Trade surplus came in at USD 90.07 billion in October, smaller than expectations of USD 95.6 billion and below the USD 95.72 billion recorded in the same month last year. It marked the smallest trade surplus since February, as exports unexpectedly fell while imports rose. 4
- In Malaysia, the Central Bank of Malaysia kept its key interest rate unchanged at 2.75% for a second consecutive meeting in November 2025, in line with market expectations. The board said the decision was appropriate and supportive of economic growth amid stable prices. Year-to-date, headline and core inflation averaged 1.4% and 1.9%, respectively. Looking ahead, headline inflation is expected to remain moderate in 2026 amid continued easing in global cost pressures, while core inflation is projected to stay stable and close to its long-term average. Recent data indicate better-than-expected GDP performance in Q3 2025, driven by sustained domestic demand, resilient electrical and electronics exports, and a recovery in commodity production. Preliminary data showed annual economic growth of 5.2% in Q3. Looking ahead, resilient domestic demand should continue to underpin growth into 2026. However, the outlook remains uncertain, particularly due to potential global developments.5
Investment Strategy6
- With the Fed now resuming rate cuts and cash returns are set to fall further, we believe it remains a good time to put cash to work. We maintain the rational for investing in both Equity and Fixed Income remains strong, and we still foresee additional growth in the coming years. Our base case remains that rate cuts have typically been supportive for stock markets during non-recession periods, as well as further benefits for fixed income.
- Investors are advised to keep sight of longer-term investing principles that can boost risk-adjusted rates of return through portfolio diversification and a phased- in strategy. This can help to manage the risk of poor timing, reduce the influence of emotion, and provide more opportunities to benefit from market dips and rebounds. Our strategy emphasized focusing on companies that demonstrate the attributes of quality growth, with earnings that are more domestically focused. Additionally, quality bonds have historically offered portfolio stability, especially in times of uncertainty.
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Sources:
1 Bloomberg, 7 November 2025
2 Bloomberg, Bureau of Labor Statistics (BLS), ISM, S&P Global, US Federal Board, 7 November 2025
3 S&P Global, ECB, Factset, Bank of England (BoE), 7 November 2025
4 Bloomberg, National Bureau of Statistic China, CEWC, 7 November 2025
5 Department of Statistic Malaysia, S&P Global, 7 November 2025
6 Principal view, 7 November 2025
*SEZ refers to Special Economic Zone
*PMI refers to Purchasing Manufacturing Index
*HCOB refers to Hamburg Commercial Bank
*NBS PMI refers to official data released by National Bureau of Statis in China
*Caixin PMI refers to data published by Caixin Media and ISH Markit. It provides alternative gauge focusing on smaller and medium-sized enterprises.
*ECB refers to European Central Bank
*PBOC refers to People’s Bank of China
*PCE refers to Personal Consumption Expenditure
*FOMC: Federal Open Market Committee
*y-o-y refers to year on year
*m-o-m refers to month on month
*UST refers to United States Treasury
*BNM refers to Bank Negara Malaysia
*Caixin decided to end its title sponsorship of the S&P Global China Purchasing Managers' Index (PMI) as of July 2025. This decision was part of a "strategic adjustment" for Caixin, aligning with its long-term development needs. Caixin had been the title sponsor since 2015, using it as a way to expand into the data sector and analyze China's economic transformation. Following Caixin's departure, RatingDog (Shenzhen) Information Technology Co., Ltd., a Chinese credit research and bond rating company, successfully acquired the exclusive naming rights for the "S&P Global China PMI". Starting with the August 2025 data release, the index was officially renamed the "RatingDog China PMI". S&P Global continues to be responsible for compiling and releasing the monthly report.
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Disclaimer: We have based this document on information obtained from sources we believe to be reliable, but we do not make any representation or warranty nor accept any responsibility or liability as to its accuracy, completeness, or correctness. Expressions of opinion contained herein are those of Principal Asset Management Berhad only and are subject to change without notice. This document should not be construed as an offer or a solicitation of an offer to purchase or subscribe or sell Principal Asset Management Berhad’s investment products. The data presented is for information purposes only and is not a recommendation to buy or sell any securities or adopt any investment strategy. This material is not intended to be relied upon as a forecast, research, or investment advice regarding a particular investment or the markets in general, nor is it intended to predict or depict performance of any investment. We recommend that investors read and understand the contents of the funds’ prospectus and product highlights sheet available on the Principal website, which have been duly registered with the Securities Commission Malaysia (SC). Registration of these documents does not amount to nor indicate that the SC has recommended or endorsed the product or service. There are risks, fees and charges involved in investing in the funds. You should understand the risks involved, compare, and consider the fees, charges and costs involved, make your own risk assessment, and seek professional advice, where necessary. This article has not been reviewed by the SC.