Technical | Fundamental Analysis Discussion Stocks Listed In Bursa

Tuesday, November 4, 2008

US Presidentila Election 08, Wall St. & Bukit Kewangan

DJIA Could Get a Short Post-Election Bounce By Zhuge Liang

US stocks are likely to get a bounce after Tuesday's presidential election, but worries about the economy and credit crisis may keep the rally short.

While the election remains important to the market, expectations of a Democratic victory may already be priced in. Polls have shown for weeks that Democrat Barack Obama has a fairly substantial lead, so analysts think only an upset win by Republican John McCain could have a significant impact on stocks.

Nobody is necessarily sure they're going to see a significant change in the next week, primarily because I think the market's already betting on a Democratic win and it would only be a Republican upset that could change the market in the short term.

Wall Street already has rendered its verdict on the prospect of an Obama victory and the Democrats retaining control over Congress.

The market believes that a Democratic Congress and a Democratic president is probably not a good thing. And if the market is nervous about that, it should already be reflected in the market. And a McCain win would be a real surprise and market traders fancy nice surprises. In short, tentaively, a McCain victory will be a stronger boost for Wall St rather than a I-told-you-so Obama victory.

Wall Street hopes to turn a new page as it bades good riddance to a nasty October and heads into November, but this week is littered with hurdles ranging from the U.S. presidential election to a likely gloomy jobs report.

Traders were more than happy to see the back of October 2008, one of the worst months in history for the broader market, and took heart from the fact that it ended with one of the best weeks on record.

This week's strength came as the host of efforts by central banks and governments to ease credit strains began to bear fruit, and volatility abated slightly. Bargain hunting and funds buying stocks to rebalance their portfolios also helped boost stocks.

For the first part of next week, Wall Street -- like the rest of America -- will turn its attention to Tuesday's presidential election.

Democrat Barack Obama's lead over Republican rival John McCain held steady as the race for the White House entered its final home run. Investors will likely assess the possibility of quick fiscal stimulus after the election and the risk of protectionist measures or more regulation.

Traditionally as past record goes, as long as the election was decisive, stock markets will likely react positively, regardless who wins.

Historical data shows that a new presidential term yield positive returns, suggesting that the lack of uncertainty after elections usually gives the market a boost. Once we know what the balance of power will look like, investors can factor that into the equation. The market may not like who wins, but it will like knowing.

Now fasten your seat belts .... US Congress is back with another financial package STIMULUS - Z !!!!

Whatever the hell that may be , it is still WOW!!!!

Malaysian bear markets data & timeframe

Some chats with fellow trading peers in office, under the big angsana tree mamak stall , in kopitiam and around the bushes. The assumptions arebasically the same old tune but sung in different keys ..... KLCI is not out of the woods. It has yet to see bottoms up.

Reasonably but not divinely correct as per below ....

#1 From TA >> estimate figure is around 700 level

#2 From Historical M'sia Bear Mkt

Bear Mkt Duration Peak Bottom %Changes

06/1981 - 08/1982 14 mths 538.30 225.51 - 58.0%

02/1984 - 05/1986 27 mths 423.81 169.83 - 59.9%

08/1987 - 11/1987 03 mths 464.16 231.26 - 50.2%

02/1993 - 01/1995 13 mths 1275.32 883.29 - 30.7%

02/1997 - 08/1998 18 mths 1270.67 302.91 - 76.2%

Average >> 15-17mths - 53%

Estimated from 01/2008....bottom shld be around 2009 2nd qtr, and 700 level from the peak of Jan 2008

#3 From PE of some Asian Countries Share Mkt ...

HK 7.5,

Indonesia 6.4,

Malaysia 10.20

S'pore 8.3,

Thailand 5.4

The PE for M'sia is higher than others, so the price shld be more downside.

Disclaimer : This is just an opinion of the writer. It is not a solicitation to buy or sell. Please refer to your remisier/broker for more infos regarding this article. Tq


No comments:

For New UBER users, Get RM15 off