It is a no secret that Bursa Malaysia is much, much depends on domestic funds. This is one of those time you will feel grateful because there are less foreign participation on Bursa Malaysia. The situation could be much worse.
Yesterday KLCI closed 21.94 point lower (close at 1,308.23 pt), that the largest overnight dip ever for FBM KLCI (since implemented 6th July 2009). Look like Bursa Malaysia at last succumbed to external financial crisis. Looking at the intraday action, my expectation of KLCI recovery by end of the week (my previous blog post) is dimmer.
I still expect KLCI to rebound (mild one) especially when the index is very close to its important support zone 1,300 pt. The ability to resume it's major bullish trend depend on this support zone to stay. We can see that in a a day or two. Otherwise, it will take a lot, lot longer and shows that Bursa Malaysia need longer time to get out of the current external financial shocks (the news of Germany short-selling regulation and falling euro currency to 4 year low).
Anyway, for some market participants, any dip in the market could be the opportunity to enter at lower cost. That is I think the better way to look at Bursa Malaysia now, especially when we (or is it just me?) are the ones who said KLCI have moved too far without any meaningful correction.
