| 05/12/2003 Monday 09:35 pm Monday 05/12 9:30 pm The strong move in blue chips signal that the trend stays firm for the near term. Banks are expected to stay firm tomorrow and with Singpost listing, expect trading volume to hit past the 1 billion mark. Singpost ipo is offered at $0.60 with yield of 7%, there could be strong demand at the opening with near term target at $0.70 which means a yield of 6 % which is attractive to funds as it beats keeping their money in cash with yield of less than 1% in Sing dollar fixed deposit. US interest rates are expected to keep low for the rest of this year as the last FOMC minutes suggest a bias to easing. Futures prices for the short-ended eurodollars are pricing in a rate cut of 25 basis point by the June 24-25 FOMC meeting. If the rate cut takes place, then stocks with high yields such as Singpost, Capital Mall and Areit may get a huge boost. Some would argue that stagflation concern may cap the downside for interest rates but US stagflation is likely to be contained as there is a counter-force in rising property values. Consumer spendings have declined and this has an impact in softening prices in durable goods. So long as interest rates stay low, US property market which is a bouyant sector could stave fears of stagflation over the next 1-2 years. For speculative issues such as TAC and to a lesser extent Leong Hin expect to see a breather as RSI remains overbought. The penny stock are still in favor and see some interest in telco sector with Pac Cent and Mediaring expected to try for new highs. Monday 04/24 9:35 pm What a rebound! With the worries on SARS abating, it is little wonder that the stocks which were battered have been big gainers. Leong Hin, TT Intl and JK Yangming look overbought and may take some breather. Penny stocks are taking the shine for now as punters are back in business. Volume leaders are still leading the way upwards and chip stocks are expected to make gains for most of this week. IPO SingPost expected to be well subscribed with current sentiments and some expect the book building price to be nearer the high end of the range of $0.50-0.60. Pfood annouced suspension of its pig slaughtering activities in Xiangtan, Meishan and Tongliao plants- see ses.com.sg for details. It could affect stock prices tomorrow at opening. Previous commentaries DISCLAIMER This is a free site and all views expressed here are not an inducement to trade or invest. The reader should be aware that investment and share trading have inherent risks and the author shall not be responsible for gains or losses incurred whatsoever. |
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