World stockmarket tumbles

World equity markets lose US$3 trillion in June

The world’s equity markets lost US$3 trillion in June as the global equity market declines that began in mid-May picked up pace and gained negative momentum at the end of the month, says Standard’s and Poor.

Source: TheStar Online

KLCI Trading suspended due to system failure

Bursa trading still suspended at 2.30pm

KUALA LUMPUR, July 3 — Trading on Bursa Malaysia will not resume at 2.30pm as notified earlier, Bursa Malaysia announced today.

It said that it will continue to update with notifications to the market as soon as it has any updates. The morning session was suspended following a multi-hardware failure in its core trading system.

Earlier, during the lunch break, Bursa Malaysia said trading will resume at 2.30pm from its back-up system at its alternate trading site.

Happy News

From TheStar report

February 5, 2008: KLCI 1.432.35 (+12.69)

February 6, 2008: KLCI 1,415.94 (+16.41)

Is the stock Index up or down?

That's a good way to celebrate bad news.

Technical Correction at KLCI today

On the 27th, the stock market tumbles.

Shanghai bourses lost 8.84% and China Shenzhen lost 8.54%. Korean Kospi was down 1.05%, Singapore STI was down 2.29% and Malaysia’s KLCI was down only 2.81%.

There was still much confidence in the stock market as KLCI seems to be on a correction phase after the hikes over the previous few weeks. The correction was expected and should stabilize within a short period. It was predicted that China's market is facing tremendous influx of hot money from the hedge funds and in fact the central bank had warned of the bubble.

Similarly, Zarinah Anwar, the then new chief of Security Commission on also warned of the possible manipulation of the local capital market conditions. For whatever reason, the Security Commission then decided to allow short-selling which was curtailed previously to mitigate the possible influx of hot-money. The decision to relax the rules on short-selling must have been politically motivated in order to boost the stock market trading volumes and gives us some signs of better economic activities. To me, it was a political decision and ultimately, we would have to pay the price.

Sure enough, since 28th Feb 2007, the stock market had lost some RM130bil in market capitalization largely due to the cashing out by the hedge funders and foreign fund management's strategic profit-taking.

Unfortunately, we are not seeing the danger and what is more alarming is the fact that Prime Minister Pak Lah had urged Malaysian investors to boost the KLCI to 1,300 index points. The GLCs and political counters saw a surged in the buying, only to have given the foreign funders the opportunity to cash-out at a high price. Who were the losers? It was observed that the local market managers and the GLCs, probably include EPF were the major buyer at the wrong time.

Though the market made a correction of some 5%, we did not anticipate that over the last few days it went on to further shrinked by another 8%, taking the total correction to some 13%, the highest as compared to the regional bourses.

What a lessons to be learnt.

Would we see the rebound soon? Unfortunately, the signs ain't too good.

The only consolation is that our stock market rebounded 1.8 percent today, lifted by bargain-hunting by foreign funds. The KLCI rose 20 points to close at 1,130.96 (about 2%) after falling 4.6% yesterday. Is this a technical correction or will the market dipped further? The next few days will tell.

However, Prime Minister Pak Lah blamed the recent plunge as reflective of the global uncertainty, and is not an indication of a weakening local economy.

Mr PM, I hope you are right.

Malaysian stocks dips 173 point from Feb 23 High

Stocks Selling keep persists!

The Kuala Lumpur Composite Index ended Monday 4.6 percent down, reaching its lowest level in nearly two months as selling persisted.

The index closed at 1,110.69, falling to its lowest since Jan. 12 from it's high of 1,283.47 on Feb 23. That's 173 points drop and losses of more than RM130bil.

MIMB Investment Bank analyst Lee Cheng Hooi said the index could fall further to 1,049 points and possibly test the 1,000 point level in the coming weeks if the sell-off continues.