by winston » Fri Dec 16, 2011 8:07 pm
Strategy: Down, but not out
Despite a volatile year in 2011, prospects for 2012 have not improved and remain murky with the lingering tensions in the eurozone region.
We expect more economic and corporate earnings downgrades in the months ahead, pricing in deteriorating market conditions, as corporate cut back on investments and expenditures and consumers cut back on demand and spending.
Recent selldown has brought stock prices to reasonable level, but gains are capped by the lack of investor confidence. The Singapore market is inexpensive, trading at only 1.2x book - below the recent 4-year average.
The preference for safer assets will continue, and defensive and good dividend yielding stocks will remain in favour. We continue to overweight selective sectors such as the Telecommunications, Healthcare and Oil & Gas sectors.
Our stock picks for 2012 are Biosensors, Cache Logistics, DBS Group, Frasers Centrepoint, Golden Agri-Resources, Keppel Corp, M1, Raffles Medical, Sembcorp Marine, SingTel, Starhub and UOB.
Source: OCBC
It's all about "how much you made when you were right" & "how little you lost when you were wrong"