Is the stock market rally over?

So, the indices of the world are now in negative territory, with many falling below their
200-Day MA. Technically, this should be the end of the bull market, and the start of a new bear market. But not yet, I think.

Reasons are:

1. Sentiment indicators are very bearish (this is a bullish sign)
2. Political stabilisation in Europe could occur soon
3. Stocks tend to trend higher during a US Presidential election year
4. Stocks are still cheap (low PE and PB), and Chinese stocks are probably past their lowest point in October 2011

At this juncture, I am fully participating in the GSS (Great Stock Sale).

My positions:

Noble
NOL
Semb Mar
Wilmar
Yanlord

Will be adding more in the next few weeks.

What to do when newspaper headlines scream "Polls revolt in Europe spooks Asian markets"

Today's Straits Times article screams "Polls revolt in Europe spooks Asian markets".  Should we bail? No way. For me, this is a very strong signal to buy. Remember, be greedy when others are fearful. From my experience, there is usually only one chance to buy shares at a sale every year. This should BE that SALE. I am monitoring my watchlist.

My watchlist:
CapitamallAsia
Capitaland
First Resources
Goodpack
Sakari
Sembcorp
Sembcorp Mar
Wilmar

What makes a good investor

Good Investors are are not exceptionally clever, nor are they especially driven.


However, they are:

     1.  At peace with themselves - they enjoy happy marriages and blissful family lives
     2.  Know their limits - never chase after share price
     3.  Make big bets when blood is on the streets
     4.  Go in with eyes wide open - they observe consumer habits and make careful note of trends
     5.  Do not accept analyst reports at face value
     6.  They do not invest if they do not understand what is going on
     7.  Have ready cash reserves to take advantage of opportunities

Adapted from "Don't go chasing stock tips" by Goh Eng Yeow. This article appeared in the Sunday Times on 22 Apr 2012.

Cheapest Stocks in 6 Years Lure Funds: China Overnight

The lowest Chinese stock valuations since 2005 are a buy signal to the biggest emerging-market money managers, who say the economy will avoid a hard landing as the government bolsters growth according to this article.

More China stocks to consider

Also, to consider China Minzhong and Petrochina.

China Minzhong Current Price: 0.99
Attractive Fundamentals. PE: 4.8,  P/B: 0.9


Petrochina Current Price: 10.84.
Sexy industry. PE: 12.05, P/B: 1.6
Bullish Engulfing.

Which China stock should I buy?

I think it's better to buy some for keeps now. China is cheap. Period.

This is a list of stocks I have narrowed down:

Stock	Price(HK$)	P/E	P/B	Technicals	Uptrend?
China Citic Bank	4.57	5.22	1	50% retracement	Yes
China Construction Bank	5.96	7.2	1.5	50% retracement	Yes
CNOOC	15.60	8	2.15	50% retracement	Yes
China Overseas Land	15.90	8.6	1.85	Little retracement	Yes
Dongfeng  Motors	13.90	9.2	2.1	50% retracement	Yes
Guangzhou R & F	10.10	5.5	1.17	Little retracement	Yes
Industrial & Commercial Bank	5.01	6.9	1.5	50% retracement	Yes
Yanlord	S$1.24	8.15	0.82	50% retracement	Yes

(Source: Bloomberg)

All are on newly established uptrends since January, and most are sitting nicely on 50% support
(the golden number). In addition, all have attractive PE ratio of below 10 and one (Yanlord) even below its book value. So, what am I waiting for?

My choice candidate: Yanlord (it has the bonus appeal of having Peter Lim on board).

China is attractive now - but is it time to buy yet?

The Shanghai market is looking REALLY attractive.

I mean, there is that little more downside that it can go, that's that. But problem is, global markets are starting to weaken. This should limit any rebound that the Shanghai market could have. So, until global stock markets fully correct, I will not be pressing the buy button yet. But I am watching closely.