Friday, November 21, 2008

Dow Jones Break Its New Low. How about KL Composite Index ?

Yesterday if we take a look at some of the prices in Bursa Malaysia, indeed some of the share prices look very cheap especially MAS Berhad, Proton Berhad, Zelan Berhad and few others. That didn’t indicate that it is a time to buy or to accumulate.

The main actor for this financial meltdown still rely on how the DJIA will play its music and how our KL Composite Index will dance along with the music.

Wall Street’s still staging it biggest wars against Dow Jones Industrial Average (DJIA) and yesterday the stocks took out new bear market lows in another volatile session Thursday. The DJIA breaks its strong supporting level of 7,881.52 points and went down -444.99 points to close at 7,552.29 points.

Mounting jobless claims continue to reflect a downbeat mood among businesses. Layoffs have been on the rise as many businesses look to cut expenses and regain footing despite tenuous economic conditions. Selling pressure took the S&P 500 down to 747.78 late in the session, which marked the lowest intraday trading level since 1997.

Not only that, it also register a huge turnover during the sharp falls. The New York Stock Exchange recorded a turnover of 10,272,949,000 shares change hands. The turnover alone indicates the selling pressure was very high. With the new low, DJIA is entering to new zones with the next strongest supporting level at 7,181.47 points recorded on 10.10.2002.

No doubt the world financial market will perform badly when they open their trading today still we need to wait and examine how the KL Composite Index will react accordingly.

Whether the share markets will experience any panic selling with DJIA already breaks its new low ? I'm doubt about it. These few days will be a crucial moment for us as we have to open our eyes bigger than usual in order to monitor whether there will be an opportunity for us to grabs.

At the moment the KL Composite Index still inside a comfort zone. With the index yesterday down only -12.33 points to close at 865.32 points. Still I would rather wait, monitor the whole situation and prefer the KL Composite Index to breaks its recently low 801.27 points recorded on 28.10.2008. It would be an easier way to determine whether the share market is entering to an oversold position.


Anonymous said...

we have spent countless hours discussing the lacklustre,anemic and 'boring' local bourse which is a laggard in the world
an illustration how pathetic the local mini mouse bourse can be is the drop registered by major/minor stock market across the globe yesterday
HK-5% tokyo 4% sing 3% BKK 3% aust.4%
KL a measly 1%
i think by the end of the week most would have drop 10-15% providing trading opportunities for most investors and our great local mart will be still treading the tight range of 1-3%

is this a blessing or curse?

Jackie Lee said...

I think our market cannot be consider a blessing intead it is a curse.

A blessing because many of us are not caught by this market.

A curse because our economic policies and the instability in our country political mess.

I think .......

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