February 2008

CHARLIE WRITES:

Early February just when Dow Jones & world bourses started to recover, following the Bush Government’s perks to prop up the US economy and stock market, a set of recessionary figures from the US service industries triggered another massive sell-down.
Overnight, Dow lost 370 points & NASDAQ lost 73 points on 5 February.
Next day, world bourses also came off.
Singapore was down only 39 points. No bad. Quite resilient.
In double-quick time, Warren Buffet announced his intention to buy over US$800b Municipal Debts. [What was not publicized was, his offer was immediately rejected by some.]
This ploy immediately propped up Dow & world markets again.
Dow went up three days in a row recovering the lost 370 points.
Insomuch as Asian Markets are apt to follow astrological forecasts, US market is apt to data gazing.
Most investors, Singapore included, seemed to have forgotten basic fundamental performances of Public Listed Companies [PLCs].
When euphoria sets in, even PLCs that just announced better results were not spared a sell-down in their share prices.
This is what a free market is about, when suckers suffer, knowledgeable investors cherry-pick.
February saw the Singapore Government boasting its economic performances in the budget review with assurances of many more good years to come.
MM Lee Kuan Yew also mentioned this time when US catches a cold, Singapore and most of Asia would be immuned.
High costs and inflation are national concern in Singapore.
Truth of the matter is the economy is vibrant and no one is without a job.
Singapore is not in a hole.

Guidance:

At half-year results ending December 2007 released by 91 PLCs by 18 February 2008, overall increase in profits was 23%.
46 of the 91 PLCs reported higher profits and 26 PLCs lower profits.
At full year results ending December 2007, released by 156 PLCs by 25 Februeary 2008, 91 PLCs recorded higher profits & 40 recorded lower profits.8 PLCs recorded loss.
Considering the fear of Singapore Banks’ exposure to the collaterized debt obligations [CDO], DBS, the worst hit of the three local banks, reported a full-year 2007 profit of $2.27b, slightly better than the 2006 profit of $2.26b.
No bad, considering that DBS has provided for the $432m CDO impairement charges.
Worldwide reporting of increase in prices of food staples like rice, flour, meat, vege, etc of up to 60% are worrying for governments.
Commodities & raw materials – fuel, ore, resins, timber, etc. — are also reported to have price increase of up to 30%.
Crude oil went past US$100 per barrel on 19 February.
Inflation is staring in the face of the world.
Inflation is caused by consumers’ needs & demands.
With inflation there is no recession, at least not in Singapore.
Inflation gives PLCs the excuse to up prices, so up profits.
So a simplistic strategy for retail investors is to be invested in PLCs instead of hogging cash.
Look for PLCs paying good dividends. [Guildline is 8% yield. Refer to newspaper’s share info data page.]
Before buying a stock, always look at how much the share price has risen over the last two weeks.
Any stock that hits the top of the box with its Relative Strength Indicator and Stochastic Momentum, must come down.
Timing to buy or to sell a stock is important to maximize gain.
Skills on when is the best time to buy or to sell a stock within a day, a week, a month or even a year, can be acquired.
Securities Investors Association (Singapore) regularly conducts such investment tutorials for members.

CHARLIE WRITES:

Early February just when Dow Jones & world bourses started to recover, following the Bush Government’s perks to prop up the US economy and stock market, a set of recessionary figures from the US service industries triggered another massive sell-down.
Overnight, Dow lost 370 points & NASDAQ lost 73 points on 5 February.
Next day, world bourses also came off.
Singapore was down only 39 points. No bad. Quite resilient.
In double-quick time, Warren Buffet announced his intention to buy over US$800b Municipal Debts. [What was not publicized was, his offer was immediately rejected by some.]
This ploy immediately propped up Dow & world markets again.
Dow went up three days in a row recovering the lost 370 points.
Insomuch as Asian Markets are apt to follow astrological forecasts, US market is apt to data gazing.
Most investors, Singapore included, seemed to have forgotten basic fundamental performances of Public Listed Companies [PLCs].
When euphoria sets in, even PLCs that just announced better results were not spared a sell-down in their share prices.
This is what a free market is about, when suckers suffer, knowledgeable investors cherry-pick.
February saw the Singapore Government boasting its economic performances in the budget review with assurances of many more good years to come.
MM Lee Kuan Yew also mentioned this time when US catches a cold, Singapore and most of Asia would be immuned.
High costs and inflation are national concern in Singapore.
Truth of the matter is the economy is vibrant and no one is without a job.
Singapore is not in a hole.

Guidance:

At half-year results ending December 2007 released by 91 PLCs by 18 February 2008, overall increase in profits was 23%.
46 of the 91 PLCs reported higher profits and 26 PLCs lower profits.
At full year results ending December 2007, released by 156 PLCs by 25 Februeary 2008, 91 PLCs recorded higher profits & 40 recorded lower profits.8 PLCs recorded loss.
Considering the fear of Singapore Banks’ exposure to the collaterized debt obligations [CDO], DBS, the worst hit of the three local banks, reported a full-year 2007 profit of $2.27b, slightly better than the 2006 profit of $2.26b.
No bad, considering that DBS has provided for the $432m CDO impairement charges.
Worldwide reporting of increase in prices of food staples like rice, flour, meat, vege, etc of up to 60% are worrying for governments.
Commodities & raw materials – fuel, ore, resins, timber, etc. — are also reported to have price increase of up to 30%.
Crude oil went past US$100 per barrel on 19 February.
Inflation is staring in the face of the world.
Inflation is caused by consumers’ needs & demands.
With inflation there is no recession, at least not in Singapore.
Inflation gives PLCs the excuse to up prices, so up profits.
So a simplistic strategy for retail investors is to be invested in PLCs instead of hogging cash.
Look for PLCs paying good dividends. [Guildline is 8% yield. Refer to newspaper’s share info data page.]
Before buying a stock, always look at how much the share price has risen over the last two weeks.
Any stock that hits the top of the box with its Relative Strength Indicator and Stochastic Momentum, must come down.
Timing to buy or to sell a stock is important to maximize gain.
Skills on when is the best time to buy or to sell a stock within a day, a week, a month or even a year, can be acquired.
Securities Investors Association (Singapore) regularly conducts such investment tutorials for members.