Technical Analysis - October 13 2008

S&P500 (899, last week 1,099 or -18.2% w.o.w )

One of the worst week for the index since 1930s. All the daily indicators are negative. The index is extremely bearish and it may take a while before any positive uptrend can be seen. Any technical rebound may be taken as a sell opportunity. The technical rebound is evident since its large volume especially on Friday, daily RSI is at 12.9% and its daily stochastics is almost at the zero level. The index may find support at 850 and 768(6 year’s low) while resistance is at 960 and 1,000.

KLSE CI (934, last week 1,017 or -8.2% w.ow)

Perhaps the best performer in the world, KLSE CI sustained the onslaught pretty well but I won’t be surprise the technical rebound will be equally slow and small. All daily indicators have turned negative. The weekly charts continued to be weak. I suspect he market will make a technical rebound this week as most of the indicators are at an oversold position. The index is expected to trade between 850 and 1,000.

HangSeng (14,797, last week 17,682 or -16.3% w.o.w )

The daily indicators are all in a negative position. A technical rebound is imminent and is likely to be lead by the US markets. The weekly charts are still in a negative territory. Support is seen at 14,000 and resistances are at 15,500 and 16,500.

Nikkei 225 (8,276, last week 10,938 or –24.3% w.ow)

The index performed worst then its Asian counterparts during last week. All the daily indicators are negative. The index is extremely bearish and it may take a while before any positive uptrend can be seen. Any technical rebound may be taken as a sell opportunity. The technical rebound is evident since its large volume especially on Friday, daily RSI is at 12.9% and its daily stochastics is almost at the 5.9% level. The weekly charts are still weak. Any technical rebound is an opportunity to sell. The support is seen at 7,500(5 year‘s low) and 9,500 and resistance is at 9,500.

* Bloomberg: RBS, HBOS, Lloyds get USD64b government investment.

* Japan and S.Korea to spearhead Asian nations' USD80b fund to protect its currencies?

* Japan's markets are closed today to celebrate "Health and Sports Day".

* Indonesia finally reopens its market after a 3 days trading halt. The main index dropped 5.7% in the opening minute but managed to crawled back the losses now.

Smart Investing/Trading for the week ending October 10 2008

Weekly US markets Update and Outlook

U.S. stocks seek relief from G7
Dow's sees worst weekly drop on record; earnings reports on tap

MarketWatch: U.S. stocks will enter next week with investors either comforted or disappointed by the meeting of the Group of Seven finance ministers and central bankers, who have gathered in Washington D.C. to address the global financial meltdown and its implications for the world's economies. "I don't know what the G7 can do exactly," said Robert Pavlik, investment strategist at Oaktree Asset Management. "But if they can come out with a positive statement, after all this is a gathering of some of the most qualified people out there, then that will help market psychology." Several hours after the close of trading Friday, G7 ministers and central bank governors pledged to work together to make sure that large important financial institutions do not fail. In a brief "plan of action" released after their meeting, the G7 said that the current market turmoil calls for exceptional action

MarketWatch Editor in Chief Dave Callaway takes a look back at an awful week for U.S. equities, and a look ahead at what may lie in store for investors. At the top of the list were unfreezing credit and money markets, ensuring banks can raise capital from the private sector, ensuring that deposit insurance regimes were robust, and repairing secondary mortgage markets where appropriate.

Also after the G7 statement, Treasury Secretary Henry Paulson gave some new details of the emerging plans by the federal government to inject capital directly into a "broad array" of financial firms. That still may fall short of the wishes of some market veterans such as Ed Yardeni, president of Yardeni Research, whose dream scenario included central banks setting up a facility to intermediate the nearly frozen inter-bank funding market. But ahead of the G7 statement, Yardeni also expressed hope that the market's meltdown was nearly over. "Of course, no one can tell how much longer or how much worse the panic selloff will be," Yardeni wrote in a note. "The best case scenario is that the capitulation and revulsion phase of this extraordinary global bear market [climaxed Friday]."

Market meltdown

With bank-to-bank lending and credit markets virtually frozen, Wall Street joined a global market rout that lasted for eight straight sessions. Over the past week alone, the Dow Jones Industrial Average lost nearly 1,900 points, or 18.2%, its worst weekly drop on record. With Asian markets tumbling Thursday night, the Dow fell nearly 700 points upon Friday's open to trade below the 8,000 market for the first time in more than five years. Banks have a golden opportunity with earnings to get everything off their balance sheets, says Russ Koesterich of Barclays Global Investors. He says write-downs could have a long way to go. But in extraordinarily volatile conditions that saw the blue-chip average swing back and forth by more than 500 points, the Dow settled down only 128 points at 8,451. The S&P 500 index finished down 10 points at 899, while the technology-heavy Nasdaq Composite managed to eke out some gains, ending up 4 points at 1,649. The weekly tallies still tell the tale. The Nasdaq fell 15.2%, its fourth worst weekly loss on record, while the broad S&P 500 index also lost 18.2%, its worst weekly drop since 1933.

For the year so far, the S&P 500 has fallen 38.8%, its worst weekly decline since 1937. Several analysts were encouraged by Friday's rebounding action and said that the market may have reached capitulation, when fear and selling reach an apex and a low is made which allows the market to rebound. "I'm more convinced now than ever that this market has made a bottom. The capitulation came when we breached 8,000," said Peter Cardillo, chief market economist at Avalon Partners. "It doesn't mean we can't go back and revisit that level."

Oil slides

In an ominous sign that investors expect a global recession, crude oil prices plunged 17% on the week, to finish at a more than one-year low below $78 a barrel. While the action could bring relief to consumers and businesses, the cause of the drop for now seemed more ominous than its implications. Not every market analysts was convinced that Friday's action would signal a rebound. "There's a little bit of buying going on," said Paul Nolte, director of investments at Hinsdale Associates. "But is it over? We won't know for a couple of months," he said. "The market is cheap if you look over 5 years, the problem who knows what will happen next week. There's nothing to say this market is not going to get much cheaper."

Many analysts say that among their biggest concern remains frozen credit and interbank lending, which have prevented everything from small firms to large institutions from conducting their business. While the cost of borrowing dollars overnight fell Friday, a key three-month rate continued to rise amid chronic tightness in global money markets. The London interbank offered rate, or Libor, for overnight dollar loans tumbled to 2.46875% from 5.09375% Thursday. But three-month dollar Libor rose to 4.81875% from 4.75% on Thursday. "It's about the banks becoming more confident and bringing Libor down," said Oaktree's Pavlik.

Earnings

As U.S. investors still try to gauge how deep an economic recession at home and abroad might be, they will look out for any outlooks from key companies reporting quarterly results next week.


Weekly KLSE CI Technical Update and Outlook

ICapital: The KLSE CI is below its 30-day, 50-day and 50-week moving averages. Both its daily MACD and DMI are bearish. On the monthly KLSE CI, the broad-market sell off has caused the KLCI to hit its initial support level and the stochastic oscillator is also severely oversold. Despite the MACD crossing into the negative area, the DMI is diverging, which is a technical sign that the downtrend is getting stronger. I Capital sees the crucial support at its 50% retracement target of 900 points. However, would the announcement by Pak Lah that he is giving up his premiership be able to prevent the KL stock market from suffering a sharp setback?

* behind every move, there is always someone behind it working, lobbying, proposing etc. Here is an example......refer here

* Will tomorrow be just another day at work? Parliament reconvenes tomorrow...will there be any roadblocks in the morning?

More bad financial news...now from Japan

Received an unsolicited email today. It is best that you check the validity and correctness of the report with your broker and other sources.

The email is read as follows:-

Regrettably, more bad financial news. Following the problems in the sub-prime lending market in America and the run on Northern Rock in the UK, uncertainty has now hit Japan.

In the last 7 days:

Origami Bank has folded,
Sumo Bank has gone belly up
Tempura Bank is in hot oil
Bonsai Bank announced plans to cut some of its branches.
Karaoke Bank is up for sale and will likely go for a song
shares in Kamikaze Bank were suspended after they nose-dived.
Samurai Bank are soldiering on following sharp cutbacks,
Ninja Bank are reported to have taken a hit, but they remain in the black.
500 staff at Karate Bank got the chop.

Analysts report that there is something fishy going on at Sushi Bank where it is feared that staff may get a raw deal.

"shinu! shinu!"

* Bloomberg: Wells Fargo took over Wachovia Corp after Citigroup walks away. The deal for the entire company cost Wells USD15b.

* Perth Mint doubles its gold output as investors seek safety from credit crisis.

* Singapore is now technically in recession. (2nd Q GDP -5.7%, 3rd Q -6.3%). Singapore which does not use interest rate as a policy tool to shape its monetary stance but uses currency instead is now in "zero percent appreciation" stance now.

Collect yourselves

AFP via The Standard: European Central Bank Chief Jean-Claude Trichet urged financial markets to "collect'' themselves after Wall Street and European stock exchanges tumbled again despite coordinated central bank cut rates."Collect yourselves,'' Trichet said on France 3 television. "Excessive pessimism is ill advised.''"We all together call upon the market participants who are in this state of intense turbulence, we tell them to collect themselves, there are elements of confidence out there,'' said the ECB chief. Leading central banks including the US Federal Reserve and the ECB unleashed coordinated interest rate cuts on Wednesday in a bid to counter the global financial crisis amid dire warnings about the economic pain ahead.

What does he mean? Collect yourselves means "accumulate shares" ourselves? Or be calm, pull ourselves together and make rational decisions? Now count to ten....take a deep breathe...breathe in and out (X2)...relax?...better?...... now start selling again! Collect yourself is also a type of prayer you know? refer here.

* So far the surprise and concerted interest rate cuts by major central banks managed to do the magic on the "day and night scare"....temporary. The latest rates for the countries are as follow:-

US 1.5%, ECB 3.75%, Canada 2.5%, UK 4.5%, Sweden 4.25%

The others that followed behind today include: South Korea 5%(-25bps), Taiwan 3.25%(-25 bps) and China 6.93%(-0.27% points)

Rate cuts will safe the day? How about 100% government guarantee of savings?

* Badawi not contesting for UMNO's top post coming March. Badawi: Over to you Najib, best of luck!

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* Bloomberg: AIG needs further USD37.8b on top of the USD85b agreed earlier by Federal Reserve.

* Bloomberg: Australia's unemployment rate climbs to 4.3% in September. (August 4.1%)

There's a Hero

500 points here, 600 points there. 10% here, 15% there. Halt trading here and there. Clearly world financial markets are in panic mode; especially so for the last 5 days. The financial market participants ranging from bank account holders, businesses and lenders are mistrusting each other; bankers afraid to lend, businesses unable to borrow, account holders worried about the safety of their cash in banks. Credit crisis sinking deeper and deeper. (refer picture). Will the American stock markets hit its circuit breaker like the Indonesian or Pakistani in their trading tonight or in the near future? It does look very gloomy and it is getting gloomier especially for the last one week. Will the Federal Reserve cuts interest rate suddenly or make further unprecedented moves to counter the plunge in the financial markets? The next rate meeting is supposed to be at the end of this month. If Federal Reserve, Treasury or Warren Buffett cannot calm the markets, can International Monetary Fund helps? I sincerely doubt so..unlike IMF's bailout of Thailand and Indonesia which only requires less than USD15b...the IMF may not have any amount near the expected USD1T fresh capital required to help financial markets. How about concerted actions from G7 rich nations? Will the Middle Easterners come in instead? Where can we find help then since countries all over the world are facing their own "crisis" at home originating from the US? Forgive me if I asked too many questions.

We are stretching out our hands in the air to welcome a "hero" to calm us down and give us some breathing space to regain our confidence. Where/Who/What is this hero? Borrowing from the chorus of "There's a Hero"(Mariah Carey) gives me some comfort and sense of hope though....

"And then a hero comes along, With the strength to carry on, And you cast your fears aside and you know you can survive"....

or is the hero lies in YOU? They say Time will tell....


* TheStar: Maybank will purchase an additional 16.26% stake in BII for Rp4.33 per share amounting to RM1.26b. Maybank did not say who the shareholders were!!!!!

* Australia slashed its interest rate by 100 bps to 6% yesterday. HK slashed its base rate to 2.5% from 3.5%. China may follow suit by the end of this week. Japan keeps its interest rate unchanged at 0.5% for the 20th consecutive months.

* USD100b British bailout plan to be revealed today?

* South Korea's won at its 10 years lowest today. 1USD: 1,385

* To stop market from slipping further....freeze the market- Russian style.

I want to "outdo" you...

Most of the major financial markets seemed wanting to outdo each other lately, with large drop. The drop ranging from 4% - 15% were experienced in Singapore to Brazil. Dow Jones and Nikkei themselves trying to outdo each other in reaching their 10,000 mark. Commodities challenging each other for a new yearly/years low. Only today, the markets seem to take a breather. Questions were raised on why our KLCI did not drop much compared to its Asian counterparts. There were plenty of explanations for it, so the market players said. The reasons include sell down on KLCI started much earlier than others due to the March 8 factor, political uncertainty and due to weakening of crude palm oil prices since July this year. The smaller foreign participation (could be lesser than 30% now) was also part of the explanation. Counterwise, could the relatively stable market due to large plantation stocks stabilising and large funds accumulating slowly? Could there be opportunity in plantation stocks in this weak and "dangerous" financial market? Like my learned colleague said, "as the US continues to pour money into the market, and the fact most of the money are borrowed, the USD will bound to weaken further. Since all commodities are in USD, commodities prices will be on the rise then to compensate for the weaker dollar, steady demand and for hedging purposes". He also go on to say that "I will not be surprised if world inflation was to hit a higher rate next year" If our coffee shop talk were to come true and economics are so easily explained, shouldn't we consider plantation stocks for our 2009's portfolio? Do you agree? Food for thought. Below is an interesting article which provide some views on how commodities will perform in the near future.

TheEdge: With global economies faltering on signs that the US is slipping into a recession, analysts’ expectations are high that oil prices will continue to fall due to slowing demand globally and a strengthening dollar though some are still hawkish about the commodity’s strength over the longer term.

RAM Holdings Bhd’s group chief economist Yeah Kim Leng (pic) said the softening in demand for oil had also spread to developed and emerging markets. “The bearish sentiment had spread to fast growing economies of BRICs (Brazil, Russia, India and China), where the energy demand was previously the highest. “In the event that the US financial woes are prolonged despite the US$700 billion (RM2.4 trillion) bailout relief for troubled banks, there would be further weakening in demand for oil from the US and this would impact the price of oil,” Yeah told The Edge Financial Daily. He also said oil prices could tumble to US$90 a barrel and below before the end of the year. “Looking at fundamental factors, oil prices now could be in the range of US$60 to US$80 a barrel. While oil prices may experience short spikes, the upward price pressures would be offset by slowing demand,” he said.

However, he said oil prices could regain its footing on any decline in the greenback. A decline in the US currency often attracts investors to buy commodities as a currency hedge. Crude oil for November delivery fell nine cents to US$93.88 a barrel at 2.45pm on the New York Mercantile Exchange last Friday. Prices have dropped 36% from the record US$147.27 a barrel reached on July 11. Some analysts said oil prices were likely to remain at current levels in the short term, as the market would be focused on reduced demand over supply constraints. “There would not be strengthening in oil prices in the immediate term. The dollar has strengthened and it is likely to be gaining strength,” Jupiter Securities head of research Pong Teng Siew said. While oil prices were likely to recover, Pong said it was unlikely to see a strong bull run as it did in the previous quarters. Merrill Lynch, in a recent report, slashed its oil price forecast to US$90 a barrel from US$107 a barrel. It warned that in the “unlikely” event of a synchronous global recession, oil prices could fall to as low as US$50 a barrel. Nonetheless, the investment bank also said the end was not in sight in the commodity supercycle. It predicted that once economic activity recovered, the demand for oil would strengthen and reassert upward pressures on prices. “Energy and commodity demand growth is a secular investment theme that probably has decades to run. “Barring massive gains in energy efficiency in the Organisation for Economic Co-operation and Development economies over the next few decades, strong emerging market demand growth will likely require a substantial increase in global oil supply growth,” it said.

* RBA going for a 50bps cut today? Current interest rate is at 7.0%.

Technical Analysis - October 6 2008

S&P500 (1,099, last week 1,213 or -9.4% w.o.w )

Another very bad week for the market. The bottom created a fortnight ago was replaced by this week’s 1,098. All the daily indicators are negative. The index is extremely bearish and it may take a while before any positive uptrend can be seen. Any technical rebound may be taken as a sell opportunity. The index may find support at 1,060 and 1,000 and while resistance is at 1,138.

KLSE CI (1,017, last week 1,021 or -0.39% w.ow)

The index was almost unchanged last week due to only 3 working days in conjunction with Hari Raya Aidilfitri. Just like last week, although most of the daily indicators remained to be weak, the MACD and its Histogram is still in a slight positive crossover. As noted in previous weeks, the index needs to work overdrive to turn the daily indicators to a positive position to avoid any broken uptrend. The general overseas markets sentiment may not help in this cause. The weekly charts continued to be weak. The index is expected to trade between 1,000 and 1,070.

HangSeng (17,682, last week 18,682 or -5.4% w.o.w )

Last week saw the gap of 18,600 to 17,800 being filled up. The Daily MACD which had a weak positive crossover last week succumbed to selling pressure and is now slightly negative. Although the daily parabolic SAR is still supporting the market, the index is likely to continue to be weak this week. The weekly charts are still in a negative territory. Support is seen at 16,700 and 16,284(recent low) and resistance is at 18,700.

Nikkei 225 (10,938, last week 11,893 or –8.0% w.ow)

The index worsened during the week and the hope of index giving in much work in order to have any positive readings in its daily indicators did not materialised. Infact, the index closed at its current low of 10,938 beating its earlier low a fortnight ago at 11,301. The weekly charts are still weak. Any technical rebound is an opportunity to sell. The support is seen at 10,500 and 9,500 and resistance is at 12,200.

* Now Europe is in the news feeling the tremors from the US's financial turmoil. The next big news will be from Asia........ Japan/S.Korea/HK/Singapore/China? European leaders have agreed to work together to limit the economic fallout, ease accounting rules and seek tougher financial regulations. Some current European fallout news: 1) Hypo Real Estate-Germany's 2nd biggest property lender, gets USD68b bailout from the government and lenders. & 2) Further to a rescue effort by the government, BNP Paribas of France will now buy 75% of Fortis Belgium for USD11.3b.

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* CNN: Stanford Financial expects that more than 100 banks nationwide to fail next year.

* Bank not safe anymore? Confidence crisis. If you have more than USD250,000 in the US, you may consider hiding the excess in your mattress rather than in your bank account? (For comparison purposes, Malaysia's insured limit is a mere USD17,600 or RM60,000 per institution!!!).

* CNN: The Federal Department Insurance Corp(FDIC) as at 30 June has 117 insured banks and savings and loans on its problem list. This represent about 1% of the nearly 8,500 institutions insured as at that date. The last savings and loans meltdown in 1991 affected about 10% of the industry.

* Australian PM says financial crisis is a Gordon Gekko mess " Greed is Good"

* BII went up 33.9% today on the resumption of trading. Somebody is laughing all the way to the bank...and he is not you or me..........

Smart Investing/Trading for the week ending October 3 2008

Weekly US markets update and outlook

After bailout, stocks face economic, earnings woes
Investors to seek signs in credit markets, economic data and earnings

MarketWatch: Investors will enter next week relieved that a $700 billion financial bailout passed Congress, but still concerned about seized-up credit markets and a worsening outlook for the economy and earnings, as reporting season officially kicks off."The news over the past week is that the credit crisis continues to widen, affecting other industries and banks in Europe," said Ken Tower, senior vice president at Quantitative Analysis Service. For the market, the bailout is "positive news that could lead to a short-term rally," Tower said. "But the longer-term picture is still that of an economy struggling with the impact of this credit crisis and the market is therefore not out of the woods yet." On Friday, the Dow Jones Industrial Average ended down 157 points, or 1.5%, to 10,325, with traders selling positions following news that Congress had approved the bailout. Stocks had rallied in anticipation of the vote and traders "sold the news," a typical reaction in cautious bear markets. The S&P 500 index fell 15 points to 1,099. The Nasdaq Composite lost 29 points to end at 1,947. For the week, the blue-chip average ended down 7.4%, the S&P fell 9.4% and the Nasdaq lost 10.8%. "This is a major market disruption," Tower said. "Even though we might be due for an interim rally, this is not the end of the problems. We're telling clients not to get over-invested in any rally that develops."

Another harrowing week

On Monday, the House of Representatives turned down the bailout, sending the Dow plunging by 777 points, its worst point drop on record. On Tuesday, the rates at which banks lend money to each other surged. The overnight London interbank offered rate, or Libor, registered a record one-day increase, reaching 6.875% from 2.568% on Monday. "A lot of what's going on in markets is confidence-related. At a bare minimum, the [bailout] bill should help with confidence," said John Miller, chief investment officer for Nuveen Asset Management, which oversees more than $60 billion in fixed-income assets. While overnight lending rates eventually came back down by Wednesday, money markets have remained nearly frozen as banks remain unwilling to lend to each other amid fear that more bankruptcies might be revealed. Many home-equity loans, lines of credit, student loans, small-business loans and credit-card rates uses Libor as a benchmark, further fueling worries about the wide economic impact. "Something has to change meaningfully in credit markets to avoid the continued slide in the economic data," said Miller.

Markets and the R-word

On Friday, the latest employment report revealed the economy lost another 159,000 jobs in September. The economy has now lost 760,000 jobs this year, further evidence that the economy was in a recession even before the financial market crisis of the past few weeks. "We are in a recession and the trend is in place to go to further job losses," said William Bellamy, who manages about $1 billion as director of fixed income at Thompson Siegel & Walmsley. "The bailout is going to work on the margin, at best," Bellamy said. "It will be nothing near the silver bullet people are hoping for. It's just one more step in a series that's going to need to be put in play. It will help. Will is cure it? No." With dire reports that the economy is shedding more jobs and that manufacturing continues to contract, investors have already started massively selling the shares of companies whose earnings depends on growth in the U.S. and globally. Separately, Merrill Lynch cut its 2009 oil price forecast to $90 a barrel from $107 a barrel and warned that a "synchronous global recession" could bring oil prices to $50 a barrel.

Economic data

On Tuesday, data on consumer credit in August will be released. Minutes from the last meeting of the Federal Reserve also will be released. The market is currently expecting that the central bank will cut interest rates by 50 basis points to 1.50% when it next meets at the end of the month. Wednesday will bring data on pending home sales for August, and on Thursday will be weekly jobless claims and wholesale trade data. Friday brings data on the trade balance in August, as well as the consumer sentiment survey by the University of Michigan.

Weekly KLCI Technical update and outlook

BT: Market to continue sideways? The KLCI's weekly and monthly fast MACDs (moving average convergence divergence) continued to stay below their respective slow MACDs. Its daily fast MACD continued to stay above its daily slow MACD. The index 14-day RSI stayed at 35.37 per cent level yesterday. Its 14-week and 14-month RSI stayed at 27.51 and 35.95 per cent levels respectively. The KLCI moved sideways during week as many institutional investors were away on their festive holidays. There was not much to work on during the three-trading-day week. Next week, the KLCI's immediate overhead resistance zone is set to hover at the 1,019 to 1,053 levels while its immediate downside support zone is likely at the 979 to 1,013 levels.

* USD700b bailout plan finally completed. Here is what to expect for market watchers and US consumers.

* Maybank also finally completed the 55.6% buy of BII, but at whose expense? (please read here for analysts' negative comments).

* Bloomberg: Now SGD is being sold down. Last Friday saw Aberdeen Asset and Daiwa selling the currency on speculation the central bank will curb the currency advance as the Singaporean economy teeters on the brink of recession.

* Last week saw Warren Buffett having another bite of a Wall Street company- GE with a USD3b stake in the company. His name speaks volume and confidence....Can't help but wonders whether he coming in too early?

* Japanese retail gasoline prices dropped for the 8th week in a row as price competition intensifies and demand weakens. Hello....When is the next reduction for Malaysia is going to be? sigh!

* Thailand's inflation slowed for the 2nd month in September falling to 6% from 6.4% in August.

Yea 205, Nay 228

This is really unexpected. The US House representatives voted down the USD700b financial proposal amid an intense "fear and haste" environment. What is really surprising is that only 1/3 of the Republicans voted for Bush's plan while 2/3 of the Democrats voted for it.

Without doubt, the US markets and other world markets plunged like no other business due to losses of confidence in the banking system. Hey, didn't RBA warned us of a "nasty" period earlier here before? New records were created yesterday:

Egs.

* Dow Jones -778 points with USD1.2T value wiped out
* S&P500 worst tumble since Black Monday Oct 19 1987
* Oil slumped more than USD10
* Reuters/Jefferies CRB Index of 19 commodities had its biggest tumble since 1956
* VIX Index- fear index closed at its highest levels in its 28 years of history

The impact of slamming down the proposal will without doubt resulting a possibility to salvage/renegotiate/modify the bailout plan amid with different considerations. The earliest they can do this is on Thursday when the House reconvened and when it is the turn for the Senate to vote. However said, the US public does not seem to be in favour of the plan to be reconsidered again. A poll done by CNN asked whether "Should the House reconsider its rejection of the USD700b economic recovery bill?" The latest verdict : Yes 47% and No 53%. Without the bill, Treasury is in a bind. Without a comprehensive administrative tools, they will need to look at issues of institutions one by one and the rescue will take longer compared to if you have the plan.

Meanwhile the Asian markets which have initially taken the bad news violently when they tumbles more than 4% in early trade closed slightly better. Could a tweaked and modified bailout plan is in the works or markets just closed better due to window dressing for the 3rd Quarter? Irregardless, the longer the time taken to adopt a comprehensive plan will sink US and other economies deeper into recession.

* Reuters: S.Korea and Indonesia will ban shot selling of shares until the end of the year. Hong Kong authorities will monitor short selling diligently.

* Bloomberg: Dexia, world's biggest lender to local government will received USD9.2b bailout from Belgium, France and its shareholders.

Selamat Hari Raya Aidilfitri

On the eve of Hari Raya Aidilfitri, I wish all my Muslim friends an enjoyable and memorable festive season with your loved ones and friends!