KLOFFE'S KLSE CI Futures Weekly Market Commentary

MARKET MOVEMENT

The Kuala Lumpur Composite Index Futures (FKLI) was traded from a high of 455.0 to a low of 405.6, a different of 49.4 index points. The direction of the market was largely influenced by the election of Japanese's (LDP)Prime Minister position; rating agencies' downgrades and economic plans of Malaysian government to stimulate Malaysia's economy.

Early this week, S&P, Moody's, and RAM dowgraded Malaysia banks ratings in Malaysia.The July futures reacted by staying at a discount on Monday, and Tuesday and Wednesday.

The long waited NEAC proposals was seen positive to the market as futures rallied to stay at premium on Thursday and Friday. The other encouraging news was the newly elected Keizo Obuchi as LDP President was well incorporated into by Japanese investor as Nikkei rallied to close above 16,300 level.

July, August and even September futures were actively traded basically on roll over 5 days before expiration. Ringgit stabled at 4.11 on Friday.

July futures closed low at 422.0, a premium of 3.6 index points compared to the underlying of 418.4.

To recap, total contracts traded for the week were 29,486 contracts, an daily average of 5,897 contracts. The 20-day volatility stayed above 40% level. Total open interest stayed above 30,000.

MARKET OUTLOOK

The market is likely to be bullish with high liquidity. The volume of August futures is expected to outnumber July futures as Friday would be the expiration of July futures. Resistance would be at 455, 440, and 430 while support can be seen at 411, 400, 380 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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