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The Reason Why KLCI Surges To Fresh Year High

Blue chips rallied in the morning session on July 21, sending the FBM KLCI to a fresh year high of 1,153.94, with Bursa among the best performers among key Asian markets. The reason behind Bursa Malaysia surges to fresh year high is mainly because it ware base on 30 share compare 100 share for old KLSE index.

FTSE Bursa Malaysia KLCI is made up of the 30 largest listed companies by market value, with at least a 15% free float and minimum 10% annual turnover of free-float shares.

Analysis by sectors weightage

  1. Banking 25.2%
  2. Plantation 14.8%
  3. Transport 11.1%
  4. Utilities 9.5%
  5. Telco 8.1%
  1. Banking 33.7%
  2. Plantation 18.7%
  3. Utilities 11.2%
  4. Gaming 9.9%
  5. Telco 9.3%
In FBM KLCI just only 2 sector bank and plantation already cover 52% weightage so it mean to short KLCI high just only need to push up bank or plantation share.

Other than this, 10 counters which have a total over 70% KLCI weightage is:-

  1. Commerce ( Najib Brother company) highest weightage 10.1%
  2. Maybank
  3. Public Bank
  4. Sime
  5. IOI
  6. Genting (Gaming sector! sure make money share, but it is halal for Muslim to buy?)
  7. Resorts
  8. Axiata
  9. Tenaga
  10. MISC
For KLCI to fly high Malaysia government just need to make sure top 5 counters perform well so compare old KLCI the news system is mach more easy and in addition Commerce bring 10.1% weightage to KLCI so sure it will make the job more easy.

7 sectors not in FBM-KLCI is:-
  1. Building materials
  2. Construction
  3. Hotels
  4. Insurance
  5. Property
  6. Timber
  7. Technology
so it also mean these 7 sector drop to bottom or zero manufacture ( worker no job ) will not affected KLCI index as long as your money keep in bank.

New technical analysis is needed to invest in KLCI, the old type invest skill by using KLCI a guide line may not complete to give a good picture about Malaysia economic so when you want to invest into the share market may need to analysis sector by sector.

Malaysia surely "boleh" Malaysia is using the concept is win the game by change the game rules follow what you want. Sure win.


Elvis2020 July 22, 2009 at 5:07 PM  

I alway look at your blog because you write many reasonable report. This is one of the best one, please keep up the good work my friend. Many blogs simply write nonsense reports base on emotion or hearsay. If we look at overall volume of KLCI, has drop from 1.6 billion daily to less than a billion. I am doubtful that major upward movement can be achieved. You are rite on this one. Yup, KLCI may look upward but only on selected counters i.e. banking and plantation stocks. But i think another round of pullback is in place. I doubt it will be major one but then again we never know for sure.

Durian Edge July 23, 2009 at 7:37 AM  

Thanks for your support.

Now KLCI just only need banking and plantation to support so I think the index may likely to maintenance at some level to give some confidence to investor to jump in into market.

However, because of that in short term the share market may end well by zip zap till the end of this year so I likely to invest in short term investment like warrant to get some fast money.

Yap we really did not know what is the final out come of KLCI but one thing to be sure is the index or the market is quit control by government.

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