Monday, December 27, 2010

Prediction of 2011

2010 is coming to the end.  Not doing so well this year. The prediction is quite accurate but the timing is totally out for me this year. These things are flying in my head these few days.

1. QE2 effect is felt through out the region especially in US which will balloon the equity market for a while.
2. Economy is getting better than expected. But unemployment will come down a bit but still remain high.
3. Inflation would be edging up higher in China. Instead of raising the interest rate, the China would opt for higher target of  Yuan appreciation especially against USD.
4. Indonesia will fair much better than Malaysia again.
5. Latex price will remain high. Users are switching more to nitrile gloves from rubber glove.
6. Properties will increase in US.
7. Interest rate would remain low in US as inflation doesn't impose a threat.
8. Commodities price would come down after hitting another historical high.
9. Gold price would come down.
10. European debt issue still remain an issue. But market would like get " used to that "
11. North Korea is still stubborn as before. There would be NO WAR with south Korea.
12. KLSE would touch 1650. DOW reaches 1300  13000 S&P 500 touches 1350.
13.BDI will still under pressure because of the flood of new fleets.
14. To be added if something comes up before the new year eve
14. General election would be held. Pakatan will have tough fight.
15. More Malaysian are migrating out of Malaysia.
16. Still a way to go for me to hit the "pop"
17. Bank Negara would be dilemma to increase the interest rate to fight inflation for that would encourage more hot money inflow. Hence, properties would remain high floated.
18. To be added if something comes up before the new year eve
18. US munibond would not default. If it does, it would be trouble again.

Guess I would stop here. 18 is a good  number. Happy New Year. May next year would be a bull for you all. Happy Trading.

Thursday, December 16, 2010

This is an very exciting news for me ...

 At last CIMB ITRADE allow me to trade via iphone .. that is pretty cool... I am kind of pleased with the launch and too excited not to post it here. Have look . :)

BY the way you can trade Thailand and Indonesia market with CIMB cross border trading facilities.. This is exciting .. In total hmmm HK, US,Malaysia, Singapore, Thailand and Indonesia..... pretty cool huh .... Adios Happy Trading !!!!

Wednesday, December 15, 2010

Of Nitrile and Rubber

Top Glove just released its the 1Q (1st September to 30 November 2010) of the financial year ending August 31, 2011. Below are the extracts from the CEO words :

" The 3 months to 30 Nov 2010 has been a challenging quarter for the Group due to
headwinds such as persistently high latex prices and the continued weakening of the
US dollar coupled with the time lag in passing on the higher costs to its customers,
which have affected the Group’s profit margins. Average latex prices rose by 57%
from RM4.58 per kg in 1Q2010 to RM7.20 per kg in 1Q2011 while the average US
dollar weakened against the ringgit by 9.3% (RM3.43 in 1Q2010 versus RM3.11 in
1Q2011). "

So now we are at this cross road. Is the worst is over for rubber glove maker ? The current latex price is roughly RM9.50 per Kg. I can't see the price would be go down soon. If we look at the revenue generated by Top Glove, we would find that it is actually pretty strong. Revenue of RM 491.5 mil in comparison to compare to last year RM 472.3 mil do tell us that the demand of the glove is pretty strong generally. What does this tell us ? The way I look at it, it mean the demand of glove will be switching to Nitrile glove from rubber glove. That in fact is recognized by Top Glove.

" The Group is also dedicating more production lines to produce nitrile gloves, which
command better margins and not subjected to the volatility in latex prices."
This in fact could be a good for Hartalega which 85% of its revenues is from the nitrile glove. Will this create a crowding problem for the nitrile glove producers ? I bet Hartalega will be positioned well to this challenge. After all they are the lowest cost producer. It is just to hard to launch a price war with them. Hartalega also has the state of art technology to position themselves among the top of its competitors. Looking at the prospects of the 2 companies Hartalega ( RM4.95 ) is deemed much cheaper than Top Glove ( RM 5.45 ). Long Hartalega.