TOL as of July 29, 2012:-
Same Old Same Old
The Dow moved about 400 points in 2 days.
This was despite some very bad earnings.
Supposedly, a simple comment out of Europe, can really move markets.
Do you smell something fishy ?
The week in review:-
Commodities
1. Oil - Flat. US$90 from US$91 last week from US$87 the previous week. Resistance at US$107 ?
2. Gold - Higher. US$1623 from US$1583 last week from US$1591 the previous week. Record US$1920. Vested.
3. Silver - Higher. US$27.70 from US$27.30 last week from US$27.25 the previous week. Range High: $48.58; Range Low US$26.25; Resistance at US$38 ? Vested.
Equities
1. US Equities - Higher. 1386 from 1363 last week from 1357 the previous week. Support at 1310 ?
2. HK Equities - Weaker. 19275 from 19641 last week from 19093 the previous week. Resistance 19,900. Support at 18,800. No Trade.
3. Shanghai Equities - Weaker. 2129 from 2169 last week from 2186 the previous week. Support at 2150 taken out. Vested A50 ETF
4. Spore Equities - Weaker. 2998 from 3016 last week from 2996 the previous week. Sold Starhill and 80% Fraser Commercial
5. Japan Equities - Weaker. 8567 from 8670 last week from 8724 the previous week.
Currencies
1. JPY - Flat. 78.51 from 78.50 last week from 79.27 the previous week. The 52 week range is 75.62 to 84.17.
2. MYR to SGD - Weaker. 2.5341 from 2.5085 last week from 2.5174 the previous week. Vested. Upcoming GE a concern.
3. AUD - Stronger. 1.0472 from 1.0400 last week from 1.0231 the previous week. Vested
4. EUR - Stronger. 1.2325 from 1.2154 last week from 1.2248 the previous week.
5. HKD - Weaker. 7.7573 from 7.7565 last week from 7.7569 the previous week. 52 week range is 7.7521-7.7972. Vested
6. Dollar Index - Weaker. 82.63 from 83.50 last week from 83.28 the previous week.
Interest Rates
1. Yield on 10 Year Italian Bonds - Lower; 5.96% from 6.17% last week from 6.06% the previous week; Record 7.483%.
2. Yield on 10 Year Spanish Bonds - Lower. 6.74% from 7.27% last week from 6.66% the previous week. Line in the sand at 7.5% ?
3. Yield on 10 Year US Treasuries - Higher. 1.55% from 1.46% last week from 1.49% the previous week.
4. Phillipines cut interest rates by 25 bps
Risk-On
1. Emerging Markets - Stronger. Inflows from Inflows last week from Outflows the previous week; http://www.epfr.com
2. Average Daily Turnover on HKEX - Higher. HK$43b ( accounted for 1/2 Day of typhoon ) from HK$42b last week from HK$42 the previous week.
3. Sentiment - Stronger
4. Headwinds - European Contagion, Muddling through in the DMs, Elevated Commodity Prices, Slower EM growth, Deleverag6. ing, Lower Margins, Weaker Earnings, Falling Property Prices, Tighter Credit Requirements, Downgrades by Rating Agencies, Austerity Programs, Iran, Exports Shock, Fiscal Cliff , Demographics, Chinese Slowdown
5. Tailwinds - Low Interest Rates, EM Consumption, EM Demographics, Cash on Sideline, Cash in Corporations for M&A, Cash in short-term Bonds, Buybacks, Money-Printing
6. Risk Management - What will you be doing when the markets dropped by 15% ?
Others
1. Properties - HK Commercial: Cushman & Wakefield expects rent for office space to advance 10% in the second half of this year.
2. Short-Selling & Buying Puts - No trade.
3. US Market Direction - Higher
It looks like the PPT was hard at work.
How else can you explained the 400 points move on the Dow, in the past 2 days ?
More importantly, is whether there would be some coordinated efforts next week, to whack the shorts.
The above is to help me crystallize my thinking. It's not a recommendation to Buy or Sell. Use the above comments at
your own risk and please do also feel free to provide me with your kind thoughts and comments
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