Malaysia stocks opened higher today, but dealers said the stimulus plan to spend RM60 billion over two years to boost the economy did not have much of an impact on the market. The rebound of KLCI was not sustainable and slipped into red in afternoon session even Asian markets were mostly recording gains. The Index lost 4.88 pts to close at 850.37. Analysts said while the package was positive for the banking, auto, plantation, construction, infrastructure, and property sectors, the lack of details were resulting in a muted response from investors.
Surprisingly, the Key Indicator (Blue) of the Daily MSO Chart gained another 37.34 pts and cut the 20-Days Average after today’s trade. The Indicator settled at -38.60. The result should be the effect of last minute buying during last few sessions which had pushed the Intra-Day Oscillators to close higher. Investors must not belittle the last minute buying of each session as it is also a sign of optimistic action. The cut through is another indication that market is trying to cast off its months long poor performance.
However, as the Indicator still remains in the negative zone and below the 50-Days Average, the uptrend couldn’t be confirmed. Market will still trade with volatility but should improve slowly. (Click on Chart to view)
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