Kuala Lumpur Composite Index

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The Kuala Lumpur Composite Index (KLCI)(abbreviated: KLCI, Chinese: 吉隆坡指數) is a stock market index generally accepted as the local stock market barometer. Introduced in 1986 to answer the need for a stock market index which would serve as an accurate performance indicator of the Malaysian stock market as well as the economy. It is used to be the main index, and is now one of the three primary indices for the Malaysian stock market which the other two are FMB30 and FMBEMAS, Bursa Malaysia. It contains 100 stocks and is a capitalization-weighted index.

1 History
2 Market Commentary
3 Chronology
4 References
5 External links

[edit] History

KLCI satisfies stringent guidelines and has gone through rigorous screenings of the component companies that were selected to compose the index. In 1995, the number of component companies was increased to 100 and it will be limited to this amount although actual component companies may change from time to time.

However in year 1997, Malaysia's markets crumbled after the government announced a takeover of the Bakun Hydroelectric project, read by some as a rescue act for its main developer Ekran Berhad. That came a bare two days after cash-rich United Engineers Malaysia paid M$2.3 billion (S$1.08 billion) to buy shares in parent company Renong in another apparent bailout.

Ringgit currency closed at 3.5040 to the US dollar which slumped to a new low, while dragging down along with the Singapore dollar as well, while the Singdollar closed at 1.6000 to the greenback, a level not seen since back in February 1994.

With yesterday's 11.08 drop by the KL Composite Index, the key Malaysian bourse has dropped 20 per cent for the week and seen nearly 57 per cent of its value wiped out since the beginning of the year. In the mean time, the Thailand Stock Exchange has fared better in comparison, dropping 49.23 per cent for the period.

[edit] Market Commentary

In 24 November, KLCI had rose 0.26%, expanding 2.7 points gained in the index which had the new high for the past nine-year. At the end of the day, the gainers lagged the losers by 375 counters to 471 counters with 304 counters unchanged. It's total value traded was 1035.9m at the value of RM1.3bn. However, the other regional major markets also closed broadly higher with the Nikkei 225 gaining 1.14%, Hang Seng increased by 0.08% and the Straits Times Index STI improved by 0.3%.

Stocks of companies that rely on domestic demand including Malayan Banking Bhd. and Bumiputra-Commerce Holdings Bhd gained after inflation eased to a 15-month low in October, giving the central bank room to keep interest rates unchanged to spur economic growth. The CPI rose 3.1% yoy which was lower than the 3.3 percent median forecast in a Bloomberg News survey of 13 economists. Maxis Communications advanced after the company reported higher-than-expected third-quarter profit.Maxis rose 60 sen, or 6.5%, to RM10.00, the highest since Aug. 24, 2005. Maybank rose 10 sen to RM11.30. Bumiputra added 5 sen to RM7.45. Batu Kawan gained 30 sen to RM11.10. The plantation company declared generous 43 sen per share dividends and a one-for-two bonus issue. Other big gainers included Malaysian Oxygen and Transmile .

Source: JF Apex Securities Bhd^[1]

[edit] Chronology

1937 - Re-registered as the Malayan Stockbrokers' Association but not traded public shares
1960 - The public trading of shares commenced on the MSE
1961 - The board system was introduced
1964 - MSE was officially formed name Stock Exchange of Malaysia and Singapore (SEMS)
1973 - The SEMS was separated into KLSEB and SES
1986 - KLCI was introduced
1993 - KLCI surpasses 1275.32
1994 - Kuala Lumpur Stock Exchange (KLSE) re-named Kuala Lumpur Stock Exchange
1995 - the number of component companies was increased to 100
1997 - Due to the Asian Financial Crisis KLCI Slumped more than 500 points within 6 month
1998 - KLCI slumped to the lowest ever at 261.330 in August
1998 - KLCI worst performanced volume at 15,907,400 - Average over days in Month
2000 - KLCI tops back to 974.380
2004 - KLSE Re-named Bursa Malaysia
2005 - Bursa Malaysia introduced CBRS
2006 - New index series jointly developed by Bursa Malaysia and FTSE Group will be introduced
2006 - KLCI hits volume at 179,959,000 - Average over days in Month
2006 - KLCI exceeds 1,060.43
2006 - KLCI exceeds 1,090.00 mark