KLSE indices weak support
KLSE 3 consecutive up trends looks like , sounds like a “surge of confident”. However, if one look closely, you will notice it is nothing more than “Twin Tower Indices stock” gain. As usual, Bolehland stock market are driven by the two “Twin tower” : financial and plantation.
Despite Malaysia government talking “Knowledge economy” for the pass 10 years, little is done to transit the production economy towards knowledge economy.
Just look at KLSE indices, you will notice consumer and trading services indices value are no more than 1% of financial + plantation. Before the global financial crisis, combination financial + plantation respresent 80% of total KLSE market value. Today, during global financial crisis, the comobo are now surge to 88%.
That means, the total market value of listed company under construction, consumer, industrial product, mining, property , tehcnology and trading, already retreat and only represent 12% of KLSE value.
This is a grave inbalance to the country economy.
Failing to diversifies the industrial, make Malaysia susceptible to turbulence market influence on those “pillar industry”. The recent KLSE rebounds due to oversale. However, as long as other industry doesn’t show a sign of rebound, it will hurt the finance and plantation industry.
The worry is, once Bolehland injecting too much money to “curtain” plantation and finance industry, what will happens to other industrial when the recession hit the shores. Does the government shelves enough funds for them?