Tuesday, August 28, 2007
Chart: SSECI's daily chart as at August 27 (courtesy of Yahoo Finance)
Chart 1: KLCI's weekly chart as at August 27 (courtesy of Quickcharts)
There is a possibility that the current re-bounce may take a short breather soon. From Chart 2 below, we have the daily chart of the KLCI overlaid with 3 moving averages. i.e. the 5-day SMA, 10-day SMA (with +2% displacement) and 10-day SMA (with -2% displacement). During the March-April re-bounce, the KLCI rallied off the low in 6 consecutive days & hit the 10-day SMA (with +2% displacement) before correcting down to the 10-day SMA (with -2% displacement). The present re-bounce did hit a high of 1292 yesterday [which is marginally above the 10-day SMA (with +2% displacement)]. If the market were to soften a bit ahead of the long weekend (which includes a Friday holiday for Independence Day), there is a good chance that it may pull back to the 1240 level [ which is the 10-day SMA (with -2% displacement)]. If this were to happen, you should use to opportunity to add to your position.
Chart 2: KLCI's daily chart as at August 27 (courtesy of Quickcharts)
Friday, August 24, 2007
Chart: HSI's daily chart as at August 23 (courtesy of Yahoo Finance)
Since my last update, we have another 3 new CWs listed, i.e. CCCC-C3, CHMOBIL-C4 & HKEX-C3. These are all non-collateralized European-style cash-settled CW issued by CIMB.
The new CWs are highlighted in blue & those CWs with attractive premium (of less than 4%) are highlighted in green.
Tuesday, August 21, 2007
Evergreen has dropped quite sharply in the current market sell-off. From a high of RM2.16 on May 24, the stock hit an intra-day low of RM1.16 on August 17. It broke its uptrend line support at the RM1.45 level. Below that, it can find support at the horizontal support line of RM1.30 & RM1.15.
Chart : Evergreen's weekly chart as at August 20 (courtesy of Quickcharts)
Based on good financial performance & attractive valuation, Evergreen is a good stock to buy for the medium-term.
Wednesday, August 15, 2007
Chart 1: KLCI's weekly chart as at August 14 (courtesy of Quickcharts)
Chart 2: 2nd Board's weekly chart as at August 14 (courtesy of Quickcharts)
Chart 3: Mesdaq's weekly chart as at August 14 (courtesy of Quickcharts)
The sharp fall in DJIA has brought the index almost to the psychological 13000 level. A break of this important level could see the DJIA testing the next horizontal support of 12850 (the February high) and thereafter the long-term uptrend line support of 12750. The latter support should hold but a break of this level could well signal the beginning of the bear market for Wall Street; something that is hard to imagine just 2 months ago.
Chart: DJIA's daily chart as at August 14 (courtesy of Yahoo Finance)
Thursday, August 09, 2007
Tong Herr’s last 4 quarterly result is substantially better than the preceding 4 quarterly result, with net profit jumping 196% from RM28.1 million to RM83.1 million, while turnover more than doubled from RM207.8 million to RM442.8 million. EPS has also jumped from 33 sen to 98 sen during these periods.
Based on its closing price of RM5.85 for today & last 4 quarter’s EPS of 98 sen, Tong Herr is now trading at a PE of 6.0 times.
Technically, Tong Herr is still in an uptrend line, with support at RM4.80. In addition, it has a strong horizontal support at RM5.00.
Chart: Tong Herr' weekly chart as at August 8 (courtesy of Quickcharts)
Based on cheap valuation & good technical outlook, Tong Herr is a good stock to invest in for the long term.
If the March recovery is a guide, the current rebound may still have some way to go before exhaustion. I think the resistance levels will likely be at the second recent gap-down level of 1333, the psychological level of 1350 and the first recent gap-down level of 1374.
Is the worst over? The answer is probably. The damage to the technical picture is significant enough that one has to be very careful at this period of time. Those who are underweighted in equity may accumulate slowly now or when the market does a pullback to re-test the low.
Chart : KLCI's daily chart as at August 8 (courtesy of Quickcharts)
Monday, August 06, 2007
On Friday (3rd August), two new CWs over indices were listed. They are KLCI-C1 & HIS-C1, which are European-style Cash-settled CWs over the Kuala Lumpur Composite Index (‘KLCI’) & the Hang Seng Index (‘HSI’), respectively.
KLCI-C1 was issued at an IPO price of RM0.215 with exercise ratio of 500:1; exercise level of 1,380 and maturing on 3rd March 2008. On the first day of listing, the KLCI-C1 dropped to RM0.165, reflecting the lower level of the KLCI (which closed at 1,335.42). At that price & index level, the KLCI-C1 was trading at a premium of 9.5%.
On the other hand, HSI-C1 was issued at an IPO price of RM0.40 with exercise ratio of 2,500:1; exercise level of 23,000 and maturing on 29th February 2008. On the first day of listing, the HSI-C1 dropped to RM0.26, reflecting the lower level of the HSI (which closed at 22,495.17). At that price & index level, the HSI-C1 was trading at a premium of 5.1%.
Friday, August 03, 2007
Since the last posting on this subject, we have also witnessed a very sharp correction in global equity. Being a leverage instrument, these CWs suffered severely. Once this correction is over, you would likely see a sharp rebounce in these same CWs.
The updated CWs valuation table for Hong Kong stocks is appended below. CWs, which traded at premium of less than 4%, are highlighted in blue.
Wednesday, August 01, 2007
Chart 1: FBM Smallcap's daily chart as at July 31 (courtesy of Quickcharts)
Chart 2: 2nd Board's daily chart as at July 31 (courtesy of Quickcharts)
Chart 3: Mesdaq's daily chart as at July 31 (courtesy of Quickcharts)
Chart: KLCI's weekly chart as at July 31 (courtesy of Quickcharts)