KLCI, What's Next?

True to my prediction on Monday, the Malaysia Stock Index did surpass historical high on Tuesday, reaching the high of 1334 on two occasions since. Investors are now seeking an answer as to what is going to happen next? Interestingly, the local funds and retail investors were apparently on an exit path for the past two days, obviously concerned that the market was going to take a major correction. However, that didn't happen! On both occasions the selling pressure were well absorbed, which suggests that foreign funds were not quite ready to quit. In reality, the abundance of liquidity is still ruling the course for the time being, at least. Also, taking the cue from external developments which are still fairly positive. For instance, the growth stories in emerging markets in Asia is still good, and employment data in US is better than expected.

Question is, how long are these funds going to stay? As usual global developments will play a key part. As for Malaysia, let the good news continue to flow and enjoy it while you can! As for the latest, Malaysia's inflation data is reportedly lower than expected.