Global Market Outlook For Week Beginning 28th September 2009
STI has the tested the 2700 level 3 times but is still unable to break this stubborn resistance successfully. It may experience a pullback to the immediate support level of 2560. If 2560 cannot prevent the drop, the next support levels will be at 2521 and 2424 respectively. Singapore market seems to have lost its upward momentum, it is now going through some consolidation before it has enough strength to break through the 2700 level, hopefully going towards the 3000 mark before the end of the year.
Trading for the China market will be light this week because of the 8 days “Golden Week” break. SSE will most likely consolidate between the 2600 and 3000 level, before it can gather enough momentum to break the 3000 ceiling to retest the early August high of 3478. At this point of time, signs are still showing that this is just a temporary halting of the upward momentum, the long term uptrend for SSE is still intact.
After breaking the resistance of 21200, Hang Seng quickly fall below this level in quite a drastic manner. It should find some support at around 20600 level, based on the uptrend line drawn starting early March. If 20600 cannot provide the necessary support, HSI may have a chance to fall back to 19400, the low attained in early September this year.
S&P 500 could not hold above the 1060 level for long and dropped consecutively for the next 3 trading days. The next immediate support will be at 1039, follow by the next uptrend line support of 1000 level.
NASDAQ did not have enough strength to power through the ceiling of 2167. As a result, it declined together with the general weakness in the US market. The next support for NASDAQ will be at the 2050 level.
Dow Jones is experiencing weakeness as well, with the next closest support at 9630. If this fail to provide the necessary flooring, the next critical support will be 9250. The 10000 level will be a very very tough ceiling to crack if it can trend upwards from here.
I can feel that the markets are slowly running out of steam as they have run too far ahead of the real economy. People are starting to realise that the “green shoots” are not really growing into small plants, instead some of them may have slowly turn into yellow weeds. Our Finance Minister Tharman has already forewarned us that we may have a double-dip recession next year, which I fully agree. The stock market has already factored in for a good economy recovery, it may turn down next year when the fundamental does not live up to the expectation. If this happen, we will most likely have a W-shaped recovery, rather than a V-shaped recovery predicted by a few TOO optimistic experts. A lot of experts associate this financial crisis to that of the Great Depression, which started from October 1929 and ended in July 1932, Dow Jones collapsed almost 90% after having a few powerful rallies. This current financial crisis started around October 2007, has it come to an end after just 18 months? I doubt so, we may see some after-effect of weakness, maybe in 2010.
Disclaimer: Please be informed that the above mentioned stocks/indexes/investment instruments are solely for the purpose of education; it is NOT a recommendation or an invitation to trade/invest. For trading/investment advice, please speak to your remisier, dealer representative or financial adviser. Please understand that there is risk in every trade/investment venture, know your risk first before you venture into any of them.
Do You Have Something To Say? Add Your Comments Here!Even Though Bullish Today, Marc Faber Is “Highly Confident” the Future Will Be Very Bleak!!
“The future will be a total disaster, with a collapse of our capitalistic system as we know it today, wars, massive government debt defaults and the impoverishment of large segments of Western society,” Marc Faber, author of “The Gloom, Boom & Doom Report” and is famous for advising his clients to get out of the stock market 1 week before the October 1987 “Black Monday” crash.
Faber has been bullish — especially on commodities and emerging market stocks — for some time now and believes the current global recovery trade will last another two-to-three years, as discussed in more detail in below clip. But he has major long-term concerns about the dollar’s long-term viability given rising U.S. deficits, massive unfunded mandates and the fact “we have a money-printer at the Fed.”
This combination will eventually lead to runaway inflation, wholesale debasement of the dollar, and a major lowering of living standards for most Americans and many Europeans as well, says Faber, who is “highly confident” in this grim prediction.
Source: Yahoo
Do You Have Something To Say? Add Your Comments Here!Days Of Making Easy Money In the Stock Market Are OVER! Join Me At My FREE Seminar To Find Out How To Select The Right Stocks and Capitalise On Them To Accumulate Our Wealth.
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Global Market Outlook for Week Beginning 21st September 2009
Straits Times Index(STI) is currently facing a strong resistance at the 2700 level. If this ceiling can be broken, 2746 will be the next stubborn resistance. If 2746 can be penetrated successfully, STI may have a chance to hit 3000 before 2009 closes. I do not foresee STI can rise beyond 3000 level by the end of 2009 because the still sluggish real economy simply DOES NOT allow this scenario to play out. In fact, for STI to rally 86% since the March low of 1455, it has already run up too much and too fast ahead of the real economy.
3000 proves to be a very tough resistance level for Shanghai Stock Exchange(SSE) to crack. It may hover between the 2600 and 3000 consolidation range for some time before it resumes its uptrend to retest the early August high of 3748. The recent 23% correction for SSE is actually a good healthy correction, but it DOES NOT signal a reversal in the long term uptrend for the China stock market.
Since early March till now, HangSeng Index(HSI) has rebounded 93% and it has just broken its early August high of 21200. With this strong momentum, HSI should have a high chance to head further north towards the next 23300 and 26300 resistance levels before 2010 comes.
S&P 500 has just penetrated the 1060 barrier and the momentum should see it climbing higher towards the next resistance level of 1168. From the low of 666 in early March, it has only rallied 61% as compared to the impressive rally of 109% for SSE, 93% for HSI and 86% for STI.
NASDAQ is now approaching a strong ceiling at 2167. Since early March, it has staged a gain of 69% from its low of 1265, beating Dow Jones and S&P 500 in term of % increase.
Dow Jones is now moving feebly towards the critical 10,000 level. This will prove to be a very very DIFFICULT level for it to break. It has only rallied 52% from its low of 6469 and is the laggard among the 3 major US indexes.
As we can observe, the Asian markets have outperformed the US market since the start of the market rebound. I believe Asia, especially China and India, and emerging markets will lead the world’s recovery from the financial crisis, instead of the usual US and Europe. Just to quote what billionaire investor and commodity guru, Mr Jim Rogers, had mentioned: “19th century belonged to UK, 20th century belonged to US, 21st century belongs to Asia, especially China”. With US dollar weakening as each day goes by and possibly high inflation coming up, I will prefer to invest my money in Asia and commodities, eg. gold, silver, oil, precious metal, agricultural product…etc, rather than in US and Europe.
Disclaimer: Please be informed that the above mentioned stocks/indexes/investment instruments are solely for the purpose of education; it is NOT a recommendation or an invitation to trade/invest. For trading/investment advice, please speak to your remisier, dealer representative or financial adviser. Please understand that there is risk in every trade/investment venture, know your risk first before you venture into any of them.
Do You Have Something To Say? Add Your Comments Here!Measures to Ensure a Stable and Sustainable Singapore Property Market
1. Mr Mah Bow Tan, the Minister for National Development, announced today(14th Sept 2009) that the Singapore Government would take the following measures to ensure a stable and sustainable property market:
a) Reinstatement of the Confirmed List for the 1st Half 2010 Government Land Sales (GLS) Programme.
b) Removal of the Interest Absorption Scheme (IAS) and Interest-Only Housing Loans (IOL), with effect from today, i.e. 14 Sep 2009.
c) Non-extension of the Jan 2009 Budget assistance measures for the property market when the measures expire.
Reinstating the Confirmed List in 1st Half 2010 GLS Programme
2. Demand for uncompleted private housing units has picked up strongly since Feb 2009. The 10,017 units sold by developers in the first seven months of 2009 had already exceeded the 4,260 units sold for the whole of 2008. In response to the strong demand from home-buyers, developers have triggered four sites to date this year from the Reserve List of the 2nd Half 2009 GLS Programme, which together could yield about 1,600 units.
3. The Government will reinstate the Confirmed List for the GLS Programme in the 1st Half of 2010. While there are still 16 residential sites in the current Reserve List that can be triggered for sale by developers, MND will also replenish the supply when drawing up the 1st Half 2010 Reserve List to meet possible increases in demand. MND will announce the details of the 1st Half 2010 GLS Programme towards the end of the year.
Interest Absorption Scheme (IAS) and Interest-Only Housing Loans (IOL)
4. The Monetary Authority of Singapore will disallow the IAS and IOL with immediate effect from today, i.e. 14 Sep 2009. This measure will apply to all private residential projects. The only exception will be uncompleted private residential projects where the units had already been offered for sale under the IAS before 14 Sep 2009. The IOL will be disallowed with immediate effect.
5. The IAS and IOL are currently offered to buyers of uncompleted private residential properties. These schemes could encourage property speculation in a buoyant market where prices are rising rapidly, as they are forms of housing loans that entirely eliminate or substantially lower regular installment payments for property purchasers in the first few years before the properties are completed i.e. issued Temporary Occupation Permit. Under the schemes, a property purchaser will not have to make any significant payment, apart from the upfront 10-20% down-payment, until the housing project is completed.
6. Genuine home-buyers can continue to purchase private housing under the standard payment scheme. The removal of the Interest Absorption Scheme and Interest-Only Loans will also encourage prospective home-buyers to consider carefully their ability to afford the properties over the long term and not rush into any purchases. This will promote a more healthy and sustainable property market in the long-run.
Property-Related Budget 2009 Assistance Measures
7. A number of measures were announced in Budget 2009 in January this year to help stabilize the property market, in view of the sharp fall in demand and considerable uncertainty in the economic outlook at the time. These measures provided developers greater flexibility to adjust supply in response to a property market downturn.
8. In view of the recent strong demand for private housing and improved conditions in the property market, the measures will not be extended when they expire. The measures are:
a) Allowing one-year extension of project completion period
b) Allowing re-assignment of Government Land Sale (GLS) sites and private land owned by foreign developers
c) Giving developers up to four years to dispose of all private residential units in the development
d) Allowing developers to rent out unsold private residential units for a maximum of four years
e) Allowing up to 2 years of property tax deferral for land under development
9. The first four measures will expire on 21 Jan 2010, and the last measure on 21 Jan 2011.
Issued by the Ministry of National Development, Ministry of Finance, Ministry of Law and Monetary Authority of Singapore
Do You Have Something To Say? Add Your Comments Here!‘I Expect a Currency Crisis or Semi-Crisis’: Jim Rogers, 1 Year After The Lehman Brothers Collapse
The worst of the economic crisis is not over and a currency crisis can happen this year or the next year, because the problem of too much debt in the system has not been solved, legendary investor Jim Rogers told CNBC, 1 year after the collapse of Lehman Brothers .
The current recovery is just a consequence of the fact that consumption fell so dramatically in 2008 and people have to buy things they need in 2009, Rogers told “Worldwide Exchange.”
“How can the solution for debt and consumption be more debt and more consumption? How can that be the solution to our problems?,” he said. “I would expect there to be a currency crisis or a semi-crisis this fall or next year. It’s crony capitalism, Bernanke and Greenspan have brought crony capitalism to America … but that’s not going to solve the world’s problems,” Rogers added.
There are still “gigantic amounts of horrible, horrible debt that hasn’t been dealt with” in Central Europe, while hopes that China will pull the world out of recession are overblown, according to Rogers. “China saved up a lot of money for a rainy day, it’s raining and it’s spending it,” he said. “But China cannot pull out America or India or Europe from all this. Their economy is a 10th of the US. Hallelujah, let them do good things but they’re not going to save the world.”
“The Federal Reserve has tripled its balance sheet and the US government’s debt skyrocketed, which may cause currency problems next year, while protectionist tendencies have already started,” he warned.
“We’re going to have some serious problems in currency markets, we’re going to have serious problems in the world markets if we see protectionism rising and rising again,” he said.
© 2009 CNBC.com
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