KLOFFE'S KLSE CI Futures Weekly Market Commentary

MARKET MOVEMENT

The Kuala Lumpur Composite Index Futures (FKLI) was traded from a high of 513.0 to a low of 468.6, a different of 47.4 index points. The direction of the market was largely influenced by the weakening Yen and the poor outlook of Japanese economy.

The heavyweights such as Telekom, Tenaga, Sime Darby, Genting and Magnum have shed to all time low which dragged down both cash and futures market.

The reasons of this unfavorable scenario were mostly caused by weak regional sentiment.

The Japanese Yen has dropped to a 8 year low of 144 Yen/USD. This caused regional currencies to tumble and triggered selling pressure of Hong Kong Dollar and Chinese Renminbi. The Hang Seng Index plunged to a 3 year low of 7673 before recovering to 7900 level on Friday.

In Hong Kong, the Hang Seng Index was just able to settle slightly above 8,550 level this week while Japanese Nikkei 225 closed at 16,323. Regional sentiment remained weak due to the instable of Japanese Yen and other regional currencies.

June futures closed low at 473.1, a slight premium of 0.73 index points compared to the underlying of 472.37. This is the lowest closing price for the spot month contract after the double festive season early this year.

To recap, total contracts traded for the week were 16,2768 contracts, an daily average of 3,255 contracts. The 20-day volatility stayed above 40% level. Total open interest stayed above 22,000.

MARKET OUTLOOK

The market is likely to remain neutral to bearish. Resistance would be at 510, 490, and 480 while support can be seen at 450, 458, 466 levels.

DISCLAIMER
The weekly market commentary has been compiled by Shu, Meng Chan (article writer) for private views only. The weekly market commentary articles are being released for the interest of Shu, Meng Chan only and should not be considered investment advice. There is no warranty or representation expressed or implied by Shu, Meng Chan as to the the accuracy or completeness of the commentary herein. The content of the articles will not reflect the general view point of the described (KLOFFE)Futures Exchange. Shu, Meng Chan will not be liable for any action taken by viewers upon reading Shu's Corner KLOFFE's Weekly Market Commentary.

(mshu@tm.net.my)
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