Thursday, October 27, 2011

KLCI Outlook: Enjoy The Ride Toward 1500-1513 Points

Bursa Recap KLCI up 13 points to 1471, the highest since 2 September
Asian markets jumped after EU leaders agreed to boost the region's rescue fund and struck a deal on a 50% writedown for private bondholders on their Greek debt.

Tracking the regional uptrend, FBM KLCI rose 13.1 points to 1470.9, the highest since 2 Sep, led by GENTING (+31 sen to RM10.30), IOICORP (+16 sen to RM5.26), PBBANK (+14 sen to RM12.62), GAM (+20 sen to RM3.37) and PETCHEM (+12 sen to RM6.31). Trading volume increased to 1.88bn shares worth RM2.4bn against Tuesday’s 951m shares worth RM1.08bn.

FBM KLCI Outlook: Enjoy the ride toward 1500-1513 points
Riding on the overnight bullish Wall St and Europe markets, FBM KLCI is expected to continue its uptrend towards 1500 psychological barrier and probably to retest the 200-d SMA (now at 1513) after a mild profit taking consolidation.

As the EU debt deal is perceived as offering more of a breathing space that gives policy makers a window of opportunity to put its house in order but it lacks any strategy to boost growth in the euro zone, where countries have been encouraged to emphasize austerity in an effort to bring down debt levels. Hence, if the euro-zone economy weakens materially, the debt dynamics will get worse and could throw the program off course.

Immediate resistance is upper Bollinger band (now at 1487), followed by 1496 (100-d SMA) and 1500 levels whilst immediate supports are 10-d SMA (1450) and 50-d SMA (1435) points.

Daily KLCI Is Towards The Upper Channel
FBM KLCI 28-10-2011

Source: HLeBroking

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