Bearish sentiment puts a dent to window dressing
Stephanie Jacob | 08 Dec 2017 00:30
Hong Leong Investment Bank head of retail research Loui Low Ley Yee says there has been a dearth of window-dressing activities in recent months
Over the past 20 years, global and local equities have often reported positive returns ranging from 70% to 85% of the time in the month of December. Market gains were also strong and often the highest in the final month of the year (see Chart 2).

During that 20-year period, both the MSCI World Equity Index and FBM KLCI Index have registered an average return of 2.4% and 3.5% respectively, according to wealth solutions provider iFAST Capital.

“Known as the ‘December effect’, this phenomenon is driven by the holiday spirit which spills into the market and tends to encourage positive investor sentiment,” iFAST analyst Tan Wei Yine tells FocusM

“This then drives more buying rather than selling and boosts the market overall.”