Meanwhile, in his note on July 29, Maybank IB’s Lee said he believed that the provider of the new FBM indices (FTSE International) used a flawed methodology for computing the open, high and low for the indices.
Computer systems carry forward the previous day’s closing price and make this the current day’s opening price, he said.
Lee said this manner of displaying and disseminating data was flawed, as FTSE International did not record the true traded open, high and low for each day.
“We have highlighted this fact to them and the error is currently being investigated and could be corrected by FTSE International in around a month’s time,” Lee said.
He said it was important to use the correctly traded prices on its charts.
“However, our view remains the same on the FBM KLCI. It is on an uptrend but as it moves higher, risks to the downside emerge on a backdrop of poorer global economic news, numbers and depression-like business conditions,” he said
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