KLCI dropped by 24.17 to 1333.23 at noon because Dow last Friday fell 315.79.
561 counters are Losers and there are only 104 winners, whereas 136 counters remain unchanged.
SJ securities has done a good analyis of the markets. I will summerised the report as follows:
Palm oil breezed through RM 4000 mark. A level that has far exceeded the high side of analysts' expectation at RM3,600. Oil price at USD102. It has also exceeded the fair estimate of USD87. And the surprising common denominator threading through these 2 commodities is the high stockpiles. There is also the slowing down on global growth which has resulted in demand weakening.
There can only be one answer. Global funds have shifted towards investing in commodities. Equity and credit markets are stuck in a meltdown.
It looks like the equity market globally, will not recover so soon. Chartwise, when the palm oil hit RM 4,400, oil is at USD 116, and Gold at USD 1047, then perhaps, it is time to take a good book at the stockmarket. On the chart, these are the resistance levels, and a good bet for a correction in commodities, and a shift back to equity.