KUALA LUMPUR (July 3): Malaysia’s ringgit halts a two-day decline as an improving outlook for local stocks counters Tuesday’s slump in crude prices.

* USD/MYR drops 0.1% to 4.1380; support 4.1199, 4.1065, 4.0930; resistance 4.1545, 4.1840, 4.1935

* Overseas investors bought $34.8m of Malaysian equities on Tuesday, a fifth day of purchases

* USD/MYR is expected to trade in 4.13-4.15 range in near term, with dollar moves the key driver, says Choong Yin Pheng, general manager for fixed income and economic research at Hong Leong Bank in Kuala Lumpur

** BNM is likely to maintain policy at its July 9 review, and continue to strike a cautious tone amid external headwinds

* Malaysia’s 10-year bond yield drops 2bps to 3.63%

* Govt will auction RM3.5b of 2034 bonds on Thursday

* Benchmark 10-year yield will likely drop to 3.48% in 4Q, Selena Ling, OCBC’s head of treasury research and strategy, wrote in a note Tuesday

** Assuming 2019 GDP growth doesn’t fall below central bank’s 4.3%-4.8% target, BNM is expected to keep rates on hold pending more details on the economic outlook

* Finance Minister Lim Guan Eng said he met with representatives from China Development Bank and China Construction Bank who are interested in helping Malaysia to issue Panda bonds, according to a report in The Star