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Haha....difficult to long, dare not to short......stay in the middle then Cheers!
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Currently I find it hard to long position as it had gone up quite a lot.. Want to short also no confident as the market sentiment seems to change liao..
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yah man, Eunos family tragedy is a typical examp. sad case ah.
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Quite similar to " Love is blind and lovers cannot see!".....................Or choose not to see Cheers!
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May 4, 2008, 3.59 am (Singapore time) 
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Weekly Market Report
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When all news is good news and bad news is ignored
By
R SIVANITHY
SINGAPORE
- If this has been a bear market rally, it will certainly go down in
history as one of the strongest - since a closing low of 2,792 on March
17, the Straits Times Index (STI) has risen 444 points or 16 per cent
to Friday's close of 3,236.
The reason for the rise is that over the past 4-5 weeks, stock markets
have found themselves in a unique position where all news is good news
and bad news is ignored. The turning point thus far in the credit
crunch saga was probably the Bear Stearns bailout in mid-March by the
Federal Reserve and the liquidity injections the US central bank
undertook, the effect of which has been to restore confidence (and
possibly complacency) to markets.
Since then US corporate
earnings have actually been weak but since the figures were apparently
not as bad as first expected, investors have rushed to buy. Fear of
losing money it seems, has quickly been replaced by fear of being left
out.
Similarly, although profit warnings are on the rise in the
local market and Q1 numbers reported so far not much to shout about,
stocks have managed an amazing rebound, with the STI now only 6.6 per
cent down for the year to date. Going forward, the questions that will
be on everyone's minds of course, will be how much longer this can go
on and what might Wall Street's reaction be if the slowdown is worse
than expected and this starts to show in the earnings.
Oil
prices at close to US$120 a barrel will undoubtedly have a part to play
with regards to their inflationary role and the eventual impact on
interest rates. It's worth noting that ten years ago, oil was just
US$10 a barrel while at the end of the 2003 Iraq invasion, the price
was US$30.
In April 30 newsletter, AMP Capital's chief economist
and investment strategist, Shane Oliver said the long-term trend for
oil prices is likely to remain up because growth in underlying demand
is expected to continue outstripping supply. As a result, he expects
the price to hit US$200 a barrel within the next five years which if it
does occur, would surely be disastrous from a growth and inflation
perspective.
However, the present global slowdown should reduce
near-term demand and afford some relief over the next six months, said
Dr Oliver, and a pullback below US$85 is expected before the uptrend
resumes.
A second wild card will be the US federal funds rate
which after last week's 25 points cut, now stands at 2 per cent. In an
interview last week with Bloomberg, Templeton Asset Management fund
manager Mark Mobius said he sees the Fed cutting the rate to 1 per
cent. 'I don't think the fear is over. You're going to continue to get
more pressure on them to lower and lower,' said Mr Mobius.
For
the time being though, Wall St does not expect another cut at the next
meeting, scheduled for June 24-25. According to a Reuters survey 17 out
of 19 major dealers said the Fed will leave rates unchanged at that
meeting although only eight said they thought the Fed was finished with
its rate cuts.
The upshot of all this is that the local market
will remain hostage to external forces, primarily Wall Street. Economic
data will be scrutinised for clues as to whether the slowdown will be
severe or mild, while patchy earnings reports will ensure a volatile
few months ahead since it's not entirely clear if the full extent of
the slowdown has yet to show in the numbers.
For now though, the
'cannot lose' mentality that was evident in stock markets throughout
2004-2006 seems to have returned, albeit in slightly smaller measure
and concentrated in the major blue chips and index stocks.
The
root of this complacency is yet another liquidity bubble the US Fed has
inflated in its attempt to stave off an all-out collapse in an election
year, one that funnily enough, it was party to in the first place. -- BT
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