Tuesday, August 27, 2013
SPX, PSE and Indonesia, weighing the bloodbath 8-27-2013
Over the past few weeks, we are anticipating US correction for a couple of weeks or months. And just around mid August, we have confirmed that we are in a major correction in US, we initially advised people that correction could be as deep as 5-12%, and the 'a' leg has been a massive 5% decline in just less than 2 weeks. Now, we could be in a 'b' wave counter rally before a final 'c' wave decline could end this correction.
Elliot wave suggests that we are already in the Major Wave 4 correction of Primary Wave III. Remember the series of Waves we have (Primary, Major, Intermediate then Minor).
And I am overwhelmed on the outcome of our dotted line few weeks ago, it exactly did happen based on the dotted forecast :) clap clap! But sad to say, I didnt follow myself, and got stuck some of my portfolio, guess need to be confident now with my 5years experience in equities/bonds/stocks etc trading.
After a counter rally to maybe around 1660-1670, and based on the length of wave 'a'. we expect another continuation of selloff that can reach as low as 1540 to 1600. (8-12% from the top).
Talking about ASPAC, selloffs already reach levels to say that we are in the Bear Market territory (20% correction or more). Indonesia tops the selloff in terms of percentage at around 26% as of Aug 27,2013. Thailand ranks 2nd and PH lands at 3rd at 20%.
Last 2 weeks ago, I have posted that double dip to 5800 level raised to 50%, the drop was too fast and our ASPAC neighbors already did a new low, so I can roughly say that a potential new low could be set in PH soon!
Estimating the drop of Indonesia (below charts), which gapped down and killed everybody with another 10% decline from its June lows could also be happening in PH (if PH do not hold on it's June lows)
On the brighter side, we don't expect PSE to get below 5k soon. Here are some of the reasons:
- DOW is expected to end its correction with another 5-7% decline.
- Jakarta is 4-5% from its 4year bull market support
- PH which was the most expensive in Asia back in Q1, was beaten by AU at 22x.
- Good amount of supports around 5400-5600, but may not be too strong.
- Blue chips, mostly banks are near their 4yr bull market support.
- and lastly, PSE's most important 4yr uptrend support is at 5181.
Worst thing to happen in this correction is to be able to meet 5181, no less than that !! else, real bear market starts.
Some stocks that are in a critical stage and must hold into their 4yr uptrend lines support to avoid another set of selloff: BDO (67),PNB(67), MBT(89), FGEN(16), SECB(115) and SM(670).
Sunday, August 11, 2013
bdo, fgen, mbt, meg, pnb, rcb, sm, smph, tel 8-11-2013
Most banks had a double dip even though reporting good earnings. Chart for PSE looks weak as well and chance of hitting back 5800 level is raised to 50%. Factor of increasing the probability is the reason that US might be heading another correction soon based from its behavior.
Top picks:
- BDO if breaks down to new low, accumulate near 72. MBT and PNB as well if breaks down to new low
- FGEN at 16.xx and SMPH at 14.xx to 15.3
- SM if reaches 700 5-yr support
Top picks:
- BDO if breaks down to new low, accumulate near 72. MBT and PNB as well if breaks down to new low
- FGEN at 16.xx and SMPH at 14.xx to 15.3
- SM if reaches 700 5-yr support
Wednesday, August 7, 2013
SPX, SPX Weekly, Germany, AU, HK 8-7-2013
Updating our probability chances, Based on Elliot Wave count, we may:
a. finished the minor wave 5 of Major wave 3 of Primary Wave III, and continuation decline/correction of major wave 4 is coming, with downside of 5-12% (raised to 80%)
b. mini wave 5 is on the line,and 2 more minor waves up before we see major wave 4 correciton (20%)
Percentage is based on the chance regarding the overall market conditions. Any breaking news may affect our forecast.
Worst is to worst, if we may need to compare Major Wave 2 and the coming Major Wave 4, it may equate to 1550 target downside.
Monday, August 5, 2013
Portfolio Management and Status 8-6-2013
For those who are asking about our current porfolio management. We took profits on the 6800 level on some of the conglomerates and energy stocks. Especially FGEN and SMPH which we have bought around 16.xx and 14.xx respectively, we did not unload them all for the reason that PE looks good and business is strong.
For Banks, we are upset on the turnaround, even most of them reported good earnings for Q2. We were just able to unload 25% of our new purchases last May-June due to minimal trading gains.
Some reasons that we unloaded during the 6800 levels are:
1. 6800 area is 61.8% retracement of the correction
2. 6800-6900 level is the strongest resistance needed to break through before we are able to meet the 7000 level.
3. US was not likely to breakout to new highs (but it did on a small note)
4. US Elliot Wave count suggests that a possible 5-12% correction is nearing soon.
PESO:
From our maximum Equity exposure on June 2013 (70% Equity, 30% Cash)
- We unloaded and became (45% Equity, 55% Cash)
DOLLAR:
From our maximum Equity exposure on June 2013 (85% Equity/Bonds, 15% Cash)
- We are continuous on unloading our US/Asia Equity, and US Bonds. We are chasing to unload US Bonds for almost on a daily basis for the reason that interest rate hike could trigger soon, to avoid possible losses. (50% Equity/Bonds, 50% Cash)
Strategy:
- Since we are anticipating a good correction is due again, or possible spark in interest rate hike that could rattle the markets. We are waiting for the sideline for US Equity to calm down since it made new All Time Highs just last week.
- PSE - will buy back near 6200-6300 level, or if it breaks down, we will anticipate a double bottom at 5700-5800
- US - will buy back Equities and Bonds when it corrects soon.
For Banks, we are upset on the turnaround, even most of them reported good earnings for Q2. We were just able to unload 25% of our new purchases last May-June due to minimal trading gains.
Some reasons that we unloaded during the 6800 levels are:
1. 6800 area is 61.8% retracement of the correction
2. 6800-6900 level is the strongest resistance needed to break through before we are able to meet the 7000 level.
3. US was not likely to breakout to new highs (but it did on a small note)
4. US Elliot Wave count suggests that a possible 5-12% correction is nearing soon.
PESO:
From our maximum Equity exposure on June 2013 (70% Equity, 30% Cash)
- We unloaded and became (45% Equity, 55% Cash)
DOLLAR:
From our maximum Equity exposure on June 2013 (85% Equity/Bonds, 15% Cash)
- We are continuous on unloading our US/Asia Equity, and US Bonds. We are chasing to unload US Bonds for almost on a daily basis for the reason that interest rate hike could trigger soon, to avoid possible losses. (50% Equity/Bonds, 50% Cash)
Strategy:
- Since we are anticipating a good correction is due again, or possible spark in interest rate hike that could rattle the markets. We are waiting for the sideline for US Equity to calm down since it made new All Time Highs just last week.
- PSE - will buy back near 6200-6300 level, or if it breaks down, we will anticipate a double bottom at 5700-5800
- US - will buy back Equities and Bonds when it corrects soon.
Friday, August 2, 2013
Fortress to Blackstone Say Now Is Time to Sell on Surge 8-3-2013
Fortress to Blackstone Say Now Is Time to Sell on Surge
By Devin Banerjee -
Aug 2, 2013 12:00 PM GMT+0800
Private-equity managers from Fortress
Investment Group LLC (FIG) to Blackstone Group LP (BX), which made billions
by buying low and selling high, say now is the time to exit
investments as stocks rally and interest rates start to rise.
Fortress, the first publicly traded buyout firm in the U.S., is preparing holdings for public offerings while struggling to find attractive new deals, Wesley Edens, who runs Fortress’s $14.3 billion private-equity business, said on a conference call with investors yesterday. That environment extends to credit and distressed investments, said Pete Briger, who oversees the New York-based firm’s $12.5 billion credit business.
“This is a better time for selling our existing
investments than making new investments,” Briger said on the
call. “There’s been more uncertainty that’s been fed into the
markets.”
Their comments echoed remarks from Apollo Global Management LLC Chief Executive Officer Leon Black to Blackstone President Tony James, who said last month the environment is ripe for selling because credit markets are still hot and equities strong. Three rounds of bond purchases by the Federal Reserve, coupled with improving earnings and economic growth, helped propel the Standard & Poor’s 500 Index up 152 percent from its bear-market low in 2009.
Speculation about the Fed’s monthly bond purchases has whipsawed stocks since May, when Chairman Ben S. Bernanke first indicated policy makers could begin reducing the stimulus this year if the job market continues to improve.
Black’s New York-based firm, which oversees assets worth $114 billion, generated $14 billion in proceeds from the sale of holdings between the first quarter of 2012 and the first quarter this year.
The industry’s focus on exits has reduced volumes of leveraged buyouts this year, with the number of private-equity deals announced declining 20 percent to 3,047 worldwide from the same period last year, according to data compiled by Bloomberg.
“It’s a difficult environment to find really attractive things when the markets are robust as they are,” Fortress’s Edens said yesterday.
Global stocks have gained 11 percent this year, led by a 20 percent rally in the S&P 500, which rose above 1,700 for the first time yesterday.
Blackstone, also based in New York, took advantage of the rising markets to sell shares in three companies -- General Growth Properties Inc., Nielsen Holdings NV and PBF Energy Inc. -- and take three public, including SeaWorld Entertainment Inc. (SEAS), in the last quarter alone. The firm, run by CEO Steve Schwarzman and James, last month reported second-quarter economic net income of $703 million, more than triple its year-earlier profit.
“With credit markets hot and equities strong, this is a better time for selling assets than for buying,” James said on call with media on July 18. “Activity levels seem to be shifting from the U.S., which has been our focus over the last couple of years, to Europe, where there’s more distress, and Asia and emerging markets, where liquidity issues are arising.”
“There will continue to be a growing series of real estate realizations as we go forth over the next 12 to 18 months,” said James.
Fortress, which in 2007 became the first publicly traded private-equity and hedge-fund manager, yesterday said second-quarter pretax distributable earnings more than tripled to $148 million from a year earlier. The company sold remaining investments in its first buyout fund. The firm’s aggregate private-equity holdings grew to a value of 1.4 times invested capital.
“Within the five-year period between 2008 to today, we witnessed one of the best times to be a buyer to one of the best times to be a seller,” said David Fann, CEO of TorreyCove Capital Partners LLC, which advises buyout managers and investors.
To contact the reporter on this story: Devin Banerjee in New York at dbanerjee2@bloomberg.net
Fortress, the first publicly traded buyout firm in the U.S., is preparing holdings for public offerings while struggling to find attractive new deals, Wesley Edens, who runs Fortress’s $14.3 billion private-equity business, said on a conference call with investors yesterday. That environment extends to credit and distressed investments, said Pete Briger, who oversees the New York-based firm’s $12.5 billion credit business.
Leon Black, chairman and chief
executive officer of Apollo Global Management LLC, in Beverly Hills,
California. Photographer: Patrick T. Fallon/Bloomberg
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Their comments echoed remarks from Apollo Global Management LLC Chief Executive Officer Leon Black to Blackstone President Tony James, who said last month the environment is ripe for selling because credit markets are still hot and equities strong. Three rounds of bond purchases by the Federal Reserve, coupled with improving earnings and economic growth, helped propel the Standard & Poor’s 500 Index up 152 percent from its bear-market low in 2009.
Speculation about the Fed’s monthly bond purchases has whipsawed stocks since May, when Chairman Ben S. Bernanke first indicated policy makers could begin reducing the stimulus this year if the job market continues to improve.
‘Almost Biblical’
“It’s almost biblical: there is a time to reap and there’s a time to sow,” Apollo (APO)’s Black said at a conference in April. “We think it’s a fabulous environment to be selling. We’re selling everything that’s not nailed down in our portfolio.”Black’s New York-based firm, which oversees assets worth $114 billion, generated $14 billion in proceeds from the sale of holdings between the first quarter of 2012 and the first quarter this year.
The industry’s focus on exits has reduced volumes of leveraged buyouts this year, with the number of private-equity deals announced declining 20 percent to 3,047 worldwide from the same period last year, according to data compiled by Bloomberg.
“It’s a difficult environment to find really attractive things when the markets are robust as they are,” Fortress’s Edens said yesterday.
Global stocks have gained 11 percent this year, led by a 20 percent rally in the S&P 500, which rose above 1,700 for the first time yesterday.
Stock Rally
The stock market rally helped push up average prices for LBOs to nine times earnings, Black said in April. A reasonable buyout price is less than eight times earnings before interest, taxes, depreciation and amortization, according to consulting firm Bain & Co.Blackstone, also based in New York, took advantage of the rising markets to sell shares in three companies -- General Growth Properties Inc., Nielsen Holdings NV and PBF Energy Inc. -- and take three public, including SeaWorld Entertainment Inc. (SEAS), in the last quarter alone. The firm, run by CEO Steve Schwarzman and James, last month reported second-quarter economic net income of $703 million, more than triple its year-earlier profit.
“With credit markets hot and equities strong, this is a better time for selling assets than for buying,” James said on call with media on July 18. “Activity levels seem to be shifting from the U.S., which has been our focus over the last couple of years, to Europe, where there’s more distress, and Asia and emerging markets, where liquidity issues are arising.”
Real Estate
Blackstone is also lining up real estate investments for sales in the next two years. Among its holdings are global hotel chain Hilton Worldwide Inc. and office properties from its $39 billion purchase of Equity Office Properties Trust in 2007.“There will continue to be a growing series of real estate realizations as we go forth over the next 12 to 18 months,” said James.
Fortress, which in 2007 became the first publicly traded private-equity and hedge-fund manager, yesterday said second-quarter pretax distributable earnings more than tripled to $148 million from a year earlier. The company sold remaining investments in its first buyout fund. The firm’s aggregate private-equity holdings grew to a value of 1.4 times invested capital.
“Within the five-year period between 2008 to today, we witnessed one of the best times to be a buyer to one of the best times to be a seller,” said David Fann, CEO of TorreyCove Capital Partners LLC, which advises buyout managers and investors.
To contact the reporter on this story: Devin Banerjee in New York at dbanerjee2@bloomberg.net
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