Tuesday, October 30, 2007

Oil price vs fed meeting --- oil price wins :)

STI drop a little today (which i feel is good). It closed down 21 pts at 3798 with a volume of 2.28 billion, down 0.56%. Property stocks continue the decline after govt announced that the deferred payment for property is going to be scrapped away.

Surprise development of Labroy marine. It was reported on ST today that the company had a foreign exchange (fx) loss of about 200 million. This was right after sembcorp marine announced a similar loss over. As this is the second company to be hit by the weaker US dollars, the pressure on shipbuilding stocks are rather high. Cosco and YZJ all undergo heavy selling, though I'm not sure if their selling is really due to this incident or just people trying to reduce their exposure before the FED rate meeting this coming few days (wed/thurs night).

I don't like the way that the director (or CEO? can't remember) saying that if the price is good, he'll just take the money and relax. Good for him, but doesn't he care about shareholders? Of course not I guess. I don't think the offer for labroy is good (it's around 2.89 something, current price is 2.800). Quite slack huh, the management level? To me, this is a sign of slacking management, not a stock that I'll like to be in. On the other hand, if my company is offered a similar amount, would I take it? Questions to be pondered over.

Flour increasing in price, wheat increasing in price, oil too...Inflation coming upon us? I think i've got to read more about commodities. It's part of my education as a worldly investor. Everytime I see the Lyxor Commodities ETF on my watchlist increasing by one bid per day. So good meh? I saw that the weightage of the fund is heavy on crude oil. Includes other commodities like soya beans, coffee, metals etc. Wonder if I can use TA to gauge the support/resistance for entry and exit points, esp since it's rather illiquid. One thing I don't like is that most of the ETF traded in SGX are based on USD, so that's the bad thing as I have to worry about 2 things: the trend of the commodities which the fund is based on ; and the exchange risk involved between USD and SGD. Hmm, looks like a look of things to look out for.

Dow down by 53 points.

I like what Decipher is talking about in his blog on 29th Oct. Focus not on the paper gains and losses, do not focus so much on the prices, but look more closely on the big picture. By not looking so much at the price (and worse still - attributing the price that fluctuates daily to certain certain reasons like I really know why), I can sit back and analyse the more macro events happening. I think I'm going the right direction.