Malaysia Market – End of the Day

Asian stocks advanced in this morning as Australia’s treasurer said the worst of the global recession may have passed and after Goldman Sachs Group Inc. raised its estimate for the U.S. Standard & Poor’s 500 Index.

David Kostin, Goldman Sachs’ U.S. strategist, boosted his year-end estimate for the S&P 500 to 1,060 from 940, citing earnings reports that have been stronger than expected. The gauge closed at 951.13 yesterday.

However, stocks became softer in the afternoon after so many days of advances. But Japan gained by another 2. 73%.

FBM KLCI was under correction but resilient to selling pressure. The Index closed lower at 1,134.70 lost 4.55 after tumbling as much as 7 points. Total Volume decreased by 96 mln shares to 912 mln shares.

Market sentiment had a bad starting and worst ending. The Intra-Day Oscillator declined from morning till noon but buying support pulled it up to end higher at -480.23 lost 253.65 from the starting. The Average recorded a loss of 336.32.

The Key Indicator (Blue) of the Daily MSO Chart hooked down to +421.89 lost 129.61. The Indicator was down by 24% from yesterday’s peak.

20MAV continued to edged higher and 50MAV bounced before falling into red.

Conclusion
After today’s lousy performance, the Key Indicator dipped by 24% from yesterday’s record. This is a bad sign in evident that market foundation, which was built by strong buying during last Thursday, has been seriously eroded. The fragile confidence diminished fast even KLCI making record after record. Investors simply didn’t believe market could sustain in such dizzy height.

As a retailer, it is imperative that the overall market sentiment should be seen in good mood. It is useless to just seeing KLCI edging higher and higher but number of gainer was out beaten by number of loser and volume shrinking day after day. This is because KLCI is only representing 30 big-caps, of which, retailers seldom put their hands on.

So, tomorrow is a critical day to decide the fate of the Key Indicator. If the Oscillator didn’t buck up then it will be a confirmed reversal day and market will down for some more days.

Having said that, it is noted that the MSO Chart did show a strong long term base. The correction should be a short one. (Constructed and Shared by Smartbiz)