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Losing Streak May End For Malaysia Stock Market

The Malaysia stock market has closed lower now in three straight trading days, declining almost 10 points or 0.6 percent in that span. The Kuala Lumpur Composite Index settled just below the 1,615-point plateau, and now investors may be tempted to go hunting for bargains when the market opens on Monday.

The global forecast for the Asian markets is upbeat in a positive response to the retail surge that accompanied Black Friday, as well as better than expected economic data from Germany. Retailers were very busy on Black Friday as the holiday shopping season officially got underway. Positive sentiment also may be generated by a report from the Ifo Institute showing an unexpected improvement in German business confidence. The European and U.S. markets were firmly higher on Friday and the Asian bourses are tipped to open in similar fashion on Monday.

The KLCI finished modestly lower on Friday, bucking the regional trend of gain on weakness form the financial shares, industrial issues and plantation stocks.

For the day, the index lost 4.23 points or 0.26 percent to finish at 1,614.32 after trading between 1,611.09 and 1,618.73. Volume was 1 billion shares worth 1.49 billion ringgit. There were 435 decliners and 216 gainers, with 335 stocks finishing unchanged.

Among the actives, CIMB Group and Metronic Global were higher, while Sime Darby, Maybank and Ariantec Global were unchanged.

The lead from Wall Street is broadly positive as stocks saw significant strength on Friday, with technology stocks helping to lead the way. The gains extended the strong upward move seen earlier in the holiday-interrupted week as traders continued to pick up stocks at reduced levels following the sell-off after the elections.

Positive sentiment was also generated by a report from the Ifo Institute showing an unexpected improvement in German business confidence. The headline German business climate index rose to 101.4 in November from 100 in October, while economists had expected the index to fall to 99.5.

Investors also kept an eye on developments in the retail sector, attempting to gauge the strength of the holiday shopping season on reports regarding the Black Friday crowds. A number of retailers opened their doors even earlier than usual this year in order to increase sales on what is already one of the busiest shopping days of the year.

However, the upward move may have been exaggerated by light volume, which came as many traders remained away from their desks amid the abbreviated trading session.

Among individual stocks, shares of Research in Motion (RIMM) moved sharply higher following bullish comments from an analyst at National Bank. RIM jumped 13.7 percent to a six-month closing high.

The major U.S. averages were sharply higher in Friday's abbreviated post-Thanksgiving session as the Dow jumped 172.79 points or 1.4 percent to finish at 13,009.68, while the NASDAQ soared 40.30 points or 1.4 percent to end at 2,966.85 and the S&P 500 surged 18.12 points or 1.3 percent to close at 1,409.15.

For the week, the major averages all posted notable gains. The Dow advanced 3.3 percent, while the NASDAQ and the S&P 500 climbed 4 percent and 3.6 percent, respectively.

In economic news, Malaysia's consumer price index increased 1.3 percent on an annual basis in October, the Department of Statistics said on Friday, unchanged from the September reading and in line with forecasts.

Food and non-alcoholic beverages prices advanced 2 percent annually, while prices of non-food products rose 1.1 percent. Housing costs and utility prices were higher by 1.5 percent on year, and transportation costs by 0.8 percent. Meanwhile, there was a 0.7 percent decrease in clothing and footwear prices.

On a monthly basis, the consumer price moved up 0.2 percent in October. In the January-October period, the index advanced 1.7 percent on year earlier, data showed.

by RTTNews Staff Writer

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