The Malaysian stock market has finished lower now in three straight trading days, plunging more than 75 points or 5 percent on its way to a five-month closing low. The Kuala Lumpur Composite Index finished just above the 1,470-point plateau, and now traders are looking for a modest rebound at the opening of trade on Wednesday.
The global forecast for the Asian markets is broadly positive, with bargain hunting expected to take hold following more than a week of brutal selling. Property stocks figure to attract plenty of interest at the current levels, along with steel, finance, airline and technology stocks. The European and U.S. markets finished firmly in the green, and the Asian bourses are expected to follow suit.
The KLCI finished sharply lower on Tuesday following heavy losses among the financial shares and plantation stocks, with more modest downside coming from the industrial issues.
For the day, the index plunged 24.85 points or 1.66 percent to finish at 1,472.14 after trading between 1,423.47 and 1,490.14. Volume was 1.896 billion shares worth 3.598 billion ringgit. There were 828 decliners and 159 gainers, with 179 stocks finishing unchanged.
Among the actives, Axiata Group, Maybank, CIMB Group, Sime Darby, Petronas Chemicals, IOI Corporation and Tenaga all finished lower, while Sanichi Technology was unchanged and Ranhill, Gamuda, UEM Land and DiGi.com ended higher.
dth="320" />>DJIA REBOUND BEFORE THE FINAL HOUR
The lead from Wall Street is finally upbeat as stocks showed a substantial upward move in late-day trading on Tuesday, although considerable volatility followed the Federal Reserve's latest monetary policy announcement. The Fed will leave interest rates unchanged at near-zero levels, adding that rates are likely to remain at exceptionally low levels at least through mid-2013.
The Fed also indicated that it now expects a somewhat slower pace of recovery over coming quarters than it did in June and said that the downside risks to the economic outlook have increased. While the central bank also said it discussed the range of policy tools available to promote a stronger economic recovery, it did not signal that it is likely to engage in another round of quantitative easing.
Bargain hunting likely contributed to the strength seen on Wall Street, with traders picking up stocks at reduced levels following the sell-off seen in recent sessions.
Meanwhile, traders largely shrugged off a report from the Labor Department showing that worker productivity fell by 0.3 percent in the second quarter compared to a revised 0.6 percent decrease in the first quarter. Most economists had predicted an even steeper 0.7 percent decline in productivity in the second quarter compared to the 1.8 percent increase that had been reported for the previous quarter.
The major averages saw further upside going into the close of trading, ending the session near their best levels of the day. The Dow jumped 429.92 points or 4 percent to 11,239.77, the NASDAQ surged up 124.83 points or 5.3 percent to 2,482.52 and the S&P 500 soared 53.07 points or 4.7 percent to 1,172.53.
In economic news, Malaysia will on Wednesday announce industrial production numbers for June, with analysts looking for a decline of 1.2 percent on year following the 5.1 percent annual contraction in May.
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