Two developments happened just the past 24 hours which brought cheers to the equity markets. The first thing was the announcement of Outright Monetary Transaction by ECB, which is the unlimited buying of short-term bond (with tenor up to 3 years) in order to depress the high yield of bond or borrowings by peripheral countries, such as Spain & Italy. The second thing was the announcement of a slate of infrastructure projects by China amounting to RMB1 Trillion. While the amount is only one quarter of the 2008 stimulus package, the market reacted positively.
In our local bourse, we can see that both FBMKLCI & FBMEMAS both broke their uptrend line yesterday. They found support at their strong horizontal line and rebound a bit. We will have to wait & see whether the two positive developments would be sufficient to put the market back on an upward trajectory.
Chart 1: FBMEMAS's daily chart as at Sept 7, 2012_12.30pm (Source: Quickcharts)
Chart 2: FBMKLCI's daily chart as at Sept 7, 2012_12.30pm (Source: Quickcharts)
3 comments:
Dear Alex,
When you all talked about "Top line" and "Bottom line", what does that mean? Can you please briefly give me an idea? Thank you very much!
Dear Alex,
What's your view on Scomi? It has been trading with high volume lately and rebounded about 45% from its low. What's your take ?
Last Friday's performance didn't continue today. This means the market is likely in a correction mode. The price of some counters look attractive. But there's the possibility it will be even more attractive if we wait first.
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