Sunday, April 26, 2009

KL Composite Index: Is 1,000 points possible?

This will be an interesting week to watch. Following last week's rally, the KLCI ended Friday at a six-month high of 992.68 points. This was 2.9 % higher than the following weekend's close of 965.17 points. Total market volume also hit the highest level in six months with over two billion shares traded on Friday alone. It's a boost certainly. A mixture of intenal and external factors had attributed to the bullish trend.

But at the local end, the PM's announcement to scrap the 30% bumiputera equity ownership quota in 27 sub-sectors has surely helped. The move has certainly helped to make Malaysia more attractive and it was one good news the market had long waited. There is supposed to be another major news on the financial services this week. Let's hope the market will react positively again. The cautious note is that there could be some profit taking there would affect the climb. Such resistance is normal and good for the market. But it is such activity that would generate interest.

There was another piece of good news. The Consumer Price Index, a barometer for inflation, continuted to ease, slowing to 3.5% in March compared to 3.7% in February. Today, the Deputy MITI Minister Mukhriz Mahathir said the government was considering scrapping the controversial Approved Permits (APs) for cars.

The series of populist measures is something the government need to do if it wishes to regain the votes the BN had lost since March 8. Further liberalisation of the affirmative actions would surely be a step forward. Malaysians want to see more need-based programmes, not ethnic skewed ones.


alvin lee said...

For heaven's sake, please take note the followings:-



The so-called "indexes" in the stock markets are merely human manipulations. They no longer reflect the TRUE HEALTH OF A COUNTRY'S REAL ECONOMY.

SmartJack said...

So what if it is 1,000 points or 1,500 points - Bursa Malaysia is a DEAD market unless the country economy undergo a major structural change.

Things always find it equilibrium in the long run. The shrinking economy cake was due to abuse of NEP.

Look at Taiwanese, they poured in resources to develop their high tech sector and it is a success story.

Can Malaysia do the same? well, it's better to have shortermism than invest in R&D. You don't know what is in store for you.

Anonymous said...

Looks like you are trying to spin as many feel good stories and seems to me nowadays you are avoiding comments on controversial stories...sorry I think the "New Malaysia" tag does not reflect on what you are writing...

Anonymous said...

Stock market. If you're WISE, Don't invest like many gamblers! Not the Malaysian SE! Its NOT a get rich quick scheme. Never will be!. Loose more than gains.

Anonymous said...

AGREE with alvin lee ENTIRELY!

Anonymous said...

The stock market may be said to be the equivalent of a casino but it's true that a person can consistently make money from the stock market than from the casino provided the investor is disciplined and experienced.

Casinos are always skewed in favour of the operator against the gambler.

BareSheen said...

Dear Dato,

Alvin Lee and SmartJack are spot on.

How inane and shallow, your tagline. It shows your utter ignorance.

I have been "investing" for a long time and I never took the KLSE seriously. No one should.

The ups and downs, they are nothing but greed, fear and uncertainty.

YOu should be asking whether these hallowed listed companies genuinely contribute to the GDP of our country; provide jobs; give decent returns to its investors by way of dividends; lead by way of excellent corporate governance etc. etc. etc.

Most muck around with numbers and manipulate the market. We all know these shenanigans.

Get real Dato and write something that makes more sense.