Invest Fair 2011 @ Suntec (13 - 14 Aug)

The spate of bad news might have dampen some markets around the world, but it certainly didn't dampen the appetite of Singapore investors and traders. This was evident in the turnout at the Invest Fair 2011 at Suntec. There was a large crowd at this event - not like the scale of IT fair, but sufficient enough people to fill the hall.

I was at the Invest Fair this afternoon, and there were large groups of people thronging the different booths. There were a healthy number of financial firms offering different products and services. Many companies are familiar names with local investors. For example I saw Shareinvestor.com, GFT, Philips, Lim & Tan, Traders Round Table and many others.

Some companies had live talks at their booths, while others rolled out big gimmicks (see the car below - from City Index). I guess folks who went to Invest Fair would already have a clear purpose of their visits, and gimmicks are not that necessary. The 'big sign board' by AIA rightly summarised a key aim of many investors - Future Proof Your Wealth. I would prefer cut in commission charged for my trading vis-a-vis any chance to win anything.

What was of interest to many people were the seminars. The seminars were practically packed full. I couldn't get any seats, and had to stand just outside the seminar area in order to peep at what was going on. I think many visitors were hoping to catch some tips / strategies to deal with the current volatile market.

Even after the seminar, many people still surround key personnel who was willing to share more about their views in the current market. I guess we the investors (or punters if you like) are often captured audience of experienced traders who shared valuable insights.

The Invest Fair 2011 is a free event, and thus for those who are interested, do drop by on Sunday for a visit. The location is Suntec Exhibition Hall 401, and opening hours are 10am till 7pm. Invest Fair also had a website with more details about the speakers, exhibitors, and other paid workshops.

US market, AA+, and QE3 - what it means for Singapore market

Standard & Poor has downgraded the US credit rating from AAA to AA+, while Fitch & Moody maintained a poor outlook for the US. I guess the downgrade is to be expected after the pro-long battle between the Democrats and Republicans over the US debt ceiling debates. It is strange that the US's economy is held ransom by the bi-partisan divide, i.e. internal politics literally killing the country. It is worrying that such a stalemate scenario is likely to happen again and again since the debt deal involved the setting up of a bi-partisan committee to decide on deficit cutting measures.

One clear effect of the debt deal is that there will be a form of Quantitative Easing coming up, i.e. QE3. This was an effect observed by Li Daokui, an adviser to the People's Bank of China. So once again US government will unleash large amount of money, and that means stock markets, commodities and prices around the world will go through another round of the roller-coaster ride.

For a start, US dollar will crumple if QE3 comes about. No brainer there. Arbitrage opportunities will be abundant for the fore market, since different currencies will react to different degree to the weakening US dollar. Sing dollar should not rise as much compared to some currencies, since Sing dollar is pegged to a basket of currencies. This also means inflation will be a bigger headache in the months to come for the Singapore consumers.

After the forex effect, next will come the general uplifing of the stock market. It was a blood bath for the past few days. In the coming weeks, there will be bargain hunting, as funds with large inflow of liquidity will hunt for safe / growing stocks in Asian markets. Singapore stock market will feel the positive effect, since funds find it easier to trade the Singapore stock market. The effect will not be over-powering, but a general rising tide should lift many ships.

So in the coming weeks, look out for valued stocks / blue chips / reliable S-Chips in the Singapore stock market. At least earn some in order to offset the inflation that will come. :)

SembCorp Marine - 1H 2011 Net Profit @ S$300.4 million

At the close of the market today, SembCorp Marine announced that it achieved a net profit of S$300.4 million for 1H ended 30 June 2011. This is 8% lower compared to the corresponding period in 2010, attributable mainly to the timing in recognition of new rigs projects since 4Q 2010.

I guess that last statement simply means there will be more profits for the 2H of 2011 then.

In addition, SembCorp Marine announced that it will be giving out a one-tier tax exempt interim dividend of 5 cents per share (i.e. $50 for a lot of 1,000 shares), the same amount that was paid out in 1H 2010. This interim dividend will be paid on 31 August 2011.

The full report, including charts about the turnover and other details (e.g. profit margins) can be found on SGX website.

SGX's 1st Full Day Trading - 1st Aug 2011

1st August 2011 marked the first full day trading for counters on the Singapore Exchange - SGX. The US debt deal lifted markets across Asia and thus SGX is no exception; it rose 26 points (0.82%) to end at 3215.27. Top volume counter was clinched by Genting, which closed 4 cents higher at $1.94, with a volume of 95,528 lots traded. There was even a transaction at 13:29:27 with 2000+ lots traded.

So I guess the 'full day trading' became a non-event, i.e. no particular news about the effect of full day trading on SGX. Perhaps the actual effects will be seen in a month or two, when dealers / remisiers have enough comments to give a proper full account of this new change. Trading volume seemed alright on 1st August, but hard to say if the volume an effect of US debt deal, or because of the full day trading.

See related:

- Full Day Trading on SGX on 1st August 2011

US Debt Crisis & Singapore Stock Market

As of 11:48pm 26 July 2011, US Dow Jones industrial average is down by about 0.5% or 60+ points. US market is still trying to digest the uncertainties surrounding the US debt crisis. Weirdest thing is that Asian markets closed generally positive today. The markets have started to build in possibilities of US debt default and frankly, many of the Asian companies have stronger fundamentals that should be able to tide these companies against tsunami effect of a US debt default.

Sure, if there is indeed a default, many companies will be hit badly (it is indeed a financial tsunami) but the growth story is already in Asia, not US. Past the effect of the financial tsunami, business will still go on in Asia. Of course, many are confident that the Washington will arrive at a solution, and 2 August is not the final deadline for the debt default. Thus Washington does have more than a week to sort out the issue.

Focusing on Singapore market, the counters have performed fairly well this week. India's hiking of interest rate by 50 basis points, and the debt crisis seemed not to have any major effect on the Straits Times Index. It closed at 3,186.57, near the closing of 2010. Jardine ($49.91), UOB ($20.50), SembMarine ($5.44) and SingTel ($3.33) have all gained. 

So would the Singapore market performs tomorrow? My guess is that should US DJIA sustain above 12,500 tonight, things should turn out normal (if quiet) on 27 July 2011.

Full Day Trading on SGX from 1 Aug 2011

It is no longer news to many in the stocks market that SGX will be introducing full day trading from 1 August 2011.  There goes the 90 minutes lunch break which serves as much needed rest for the traders / remisiers. There are two clear advantages:

a) Investors can react faster to news, especially for news in Asia that can impact their stocks. Thus they can trade during the original lunch break to take advantage of market reactions.

b) More trading can happen since the number of hours for trading per day has effectively increased by 90 minutes. This benefits both SGX as well as the brokerage houses.

However, I don't see much advantage for the remisiers. The availability of lunch hours for direct trading, means more clients will switch to online trading at their own computers, essentially cutting down the number of clients for remisiers. Currently, clients who are only free during their lunch breaks, will be more comfortable to call their remisiers and place orders. In furture, they will just click at their computers.

I guess other than technology (online trading platforms), remisiers are now hit by developments of stock exchanges as well.

See related:
- SGX's 1st Full Day Trading - 1st Aug 2011

YangZiJiang - Coast is not clear (yet)

YangZiJiang has recovered from its recent low. However, the recovery is due in part from the macro developments (clarity from Greek debt and US stock market), as well as the company's clarification that it is not issuing any convertible bonds.

The outlook for YZJ is still not clear, i.e. not a rally in any sense. The general price is still trending within a downward channel, while the price may get stuck in the price range of $1.40-$1.42. This price range seems to be a resistance / support as previously noted.

YangZiJiang will need to break this trading range of $1.40-$1.42 over the next few days in order to trigger more confidence, from a trading perspective.

SGX - Bid Size Changes

From the 1st trading Monday of July (4th July), the bid size for SGX listed stocks will be changed. Thus it was with a bit of a surprise when I saw the prices of stocks this morning, i.e. not the usual price figures that I expected.

SGX website has done up a good summary of the changes, including an illustration. For a quick glance of the changes, here's an extracted table:

I'm not sure how this will affect the market. Not likely to have significant changes in my opinion.

QE2 Effect on US$ and Stocks

The US government's QE2 (a.k.a. Quantitative Easing 2) is ending this week and I believe this is the main impact that caused the US$ to rise (against S$) and the recent stock market woes.

When the QE2 was first launched, it resulted in a lot of liquidity in the market. Big funds will use the money, convert to Asian currencies, and trade for higher (or some would say safer) returns in the Asian stock markets. Afterall, Asian countries should have better growth prospect compared to the US between end last year till now. This means that US$ would have weakened and Asian stock market would have enjoyed some form of rallies.

When QE2 is ending, the reverse will hold true. Big funds will dumped their Asian stocks and convert the proceeds back to US$. Thus this few days we can observe big volume transactions in some stock counters, while the US$ continues to strengthen. One example that I can point out is SingTel shares. From yesterday I have observed transactions in sizes over 1,000 lots, i.e. about S$3million plus per transactions. There were a number of these transactions for both yesterday and this morning. See the pic below for transaction sizes at 10:03:28am and 10:02:33am.

I guess this period has been great for the bears. Let's see what happens after QE2 ends on 30 June 2011.

YangZiJiang - Price Bottoming?

In mid-June I posted in Bulls & Bears that YangZiJiang continued to trade within its downward channel with more downside to go. True enough, YangZiJiang fell to a low of $1.39 close last week.

Using the chart, YangZiJiang has some signs that the price has bottomed out. Of course, the more seasoned audience will caution that this may be just a short retracement, i.e. the price may have more dowside.

However, given that US's QE2 is ending in a few days and the big funds should already have exited their positions, there may be limited downside to stocks with good fundamentals. YangZiJiang's RSI and MACD show signs of bottoming (last candlestick is still forming in chart above). Should YangZiJiang maintain the support of $1.40-$1.42 and close positive over the next few days, July will be a good upward price movement month for YangZiJiang. No vested interest (at this juncture).

Sunvic - Head & Shoulder pattern completed?

Sunvic has displayed a head & shoulder pattern over the past weeks. Based on the head and neckline, the price pattern seems to have completed its course when it tested the low around $0.71.

However, the price pattern continues to trend within the downward channel, and thus it is unlikely for Sunvic to have any bullish breakout in the short term. MACD (not in this chart) is still trending down.

YangZiJiang

Despite the recent announcement about the Seaspan deal, YangZiJiang doesn't seem to be able to break out of it's downward trend. It is still trading within the same downward trend, and it will be dangerous for any trader to pick bottoms.

YangZiJiang has more downside to go. The only consolation is that the RSI seems to have reached its bottom, while the MACD maybe reversing. With the DJIA moving up more than 100 points at the time of posting, stocks in Singapore may also rise in tandem tomorrow. If the price movement over the next few days can allow YangZiJiang to break out of $1.60, then there may be hope for this big shipbuilder.

Pit Bull by Martin "Buzzy" Schwartz

I've just finished the book "Pit Bull" by Martin "Buzzy" Schwartz and I must say that it is an excellent read.

He has very aptly and humorously described the life of a trader. It is a stressful life, judging from the different events that happened to him. I couldn't imagine myself running to the bank and withdraw my 'gold & jewellery' in such panic state of mind; he did that twice. I think I would get a heart attack if I were in these extreme stress situation. Of course, Martin Schwartz has earned millions from the market from his trades.

The book offers many advice (not just his last chapter on methodology) and any aspiring trader should try to read "Pit Bull"; it offers an insight before one jumps into the trade.

Current Positions & Yangzijiang

Away for holiday for a week.

The recent drop for stocks is significant, just a pity I couldn't get out in time.

Still having the following positions:
- Sunvic - Semb Marine
- Sunningdale Tech

Yangzijiang continues to be in a down trend, and perhaps it is time to pay more attention to it. MACD and RSI both trending down, but the price will attempt to close the gap. Likely to hit the sloping trend line before its downward spiral.

Market Swings

The past 2 days' market movement for the STI had been somewhat extreme and that affected the trading psyche. This re-affirms that the mindset and will power of a trader are important traits for successful trading.

Guess the lost suffered (MIDAS bought at $0.72 and sold at $0.70) is a good reminder.

MIDAS - Reversal?

MIDAS has been experiencing price sliding for many sessions. However, a possible 'hammer' might have formed 2 days ago. This hammer is somewhat short in its lower shadow and there is no volume confirmation about such a pattern.

Short term EMA (5 days) is still lower than the long term EMA (20 days) but it is catching up.

Judging from the volume distribution, it doesn't seems like many of the big boys are buying into this stock, but more like house traders placing their bets. Towards later part of the day, there is some bigger scale buying up activity.

For those with bigger appetite for risk, this stock may turn out fruitful till the price reaches $0.76- 0.77. Do watch out for the volume confirmation this 1-2 days, lacking which it will be time to cut loss.

P.S. Vested.

Current Positions

I was expecting more exciting trading movements past the recent GE 2011, but the market activity seems somewhat muted.

Nonethess, prior and post GE 2011, I've taken these positions:

- YangZiJiang bought at $1.72 and sold at $1.74
- Sunvic bought at $0.84
- MIDAS bought at $0.72

Existing long positions in Semb Marine and Sunningdale Tech still hold.

Sunvic - Resistance at $0.82

Despite in a 'XD' status, Sunvic continues to display bullish tendency. The short term EMA is still higher than the long term EMA. Based on the chart below, Sunvic is moving within an upward trending channel.

However, it is hitting its recent high of $0.82 which will be a major resistance. There is further room for growth since the RSI is still in a neutral region while the price is trending upwards. It is likely to break the $0.82 since there is major buy up (seen from the volume distribution chart).

P.S. Vested interest after post - at $0.84 since the resistance of $0.82 was broken with strength.