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Thursday, February 18, 2016

Market Daily Report: KLCI closes higher as market reacted to oil rally



If this is not volatile, then what is?

Yesterday, the market was down slightly, and people blamed it on the possibility of Iran not joining the Russian-Saudi-led move to freeze production but today, the global market celebrated the "support" from Iran.

I was looking at the Wall Street rally yesterday, thinking to myself, there it goes again. At one time, the analyst blame the oil for the downtrend, then they said it's surging or rallying because of it. 

Anyway, the FBM KLCI started the day with a strong rally and reached its high of 1,685.65 for the day before some profit taking kicks in. Nevertheless, the benchmark index still close 15.70 points higher to 1,680.02 points.

FBM KLCI jumped 15.70 points to 1,690.02

News from Reuters said that US crude was up 2.1% at US$31.34 a barrel following a 7% jump on Wednesday after Iran voiced support for a Russia-Saudi-led move to freeze production to deal with the market glut that had pushed prices to 12-year lows.

While there has been some confusion as to whether 'support' equals action, oil traders are simply relieved that the world's fourth-largest holder of oil reserves is willing to cooperate.

On the broader market, Bursa Malaysia saw 1.67 billion shares worth RM2.10 billion traded. Gainers edge out decliners at 545 against 302.

Sam Engineering & Equipment (M) Bhd led decliners, while Kuala Lumpur Kepong Bhd led gainers. The top-active stock was Xidelang Holdings Ltd.

Asian share markets were up with MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.8 percent, Japan's Nikkei gained 2.28%, Hong Kong's Hang Seng increased 2.32% while South Korea's Kospi closed 1.32% higher. Nearer to home, Singapore’s Straits Time Index up by 1.73%.

Perhaps looking from recent trend, some of the things to watch out for in trading is the oil price, problems coming out from Europe, a slowing US and China’s economy. The combination of these factors could be the catalyst for a bear market.

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