Gold is higher once more.

Gold hits record high in Asian trade
Posted: 12 May 2010 1113 hrs

HONG KONG : Gold opened at a record high of 1,228.00-1,229.00 US dollars an ounce in Hong Kong on Wednesday, as investors sought a safe-haven over deepening concerns about the eurozone debt crisis.

The precious metal closed in Asia on Tuesday at 1,208.00-1,209.00 dollars but later climbed as high as 1,224.82 dollars an ounce in European trade.

Analysts said the commodity was likely to maintain its safe haven role while other markets remained vulnerable.

The previous record for the metal was set on December 3 last year when it reached 1,226.56 dollars.

"The response of the central banks and the IMF to the southern European mess is almost guaranteed to ensure continued volatility in world markets," said Capital Spreads analyst Simon Denham.

Investors had on Monday welcomed the European Union and International Monetary Fund aid package worth 750 billion euros (one trillion dollars) to resolve the debt and budget deficit crisis in Europe.

However, the euphoria faded on Tuesday amid resurgent doubts over countries' ability to reduce their deficits.

Read complete article here.

Gold Surges: Time to Climb on Board or Is the Party Just About Over?
Posted May 12, 2010 03:06pm EDT by Heesun Wee



Related post:
Gold at US$1,210 an ounce.

Saizen REIT: 3Q FY2010 Results.

A good set of numbers overall for Saizen REIT.  The only thorn in its side remains the CMBS for YK Shintoku which it defaulted on late last year.

Key points for me:

1. Saizen REIT's properties are all Freehold and not Leasehold.  So, there is no "depreciation" which some investors might be concerned about.

2. Occupancy rates have been consistently above 90% even through the financial crisis which reinforces the idea that demand is relatively inelastic for Saizen REIT's properties.

3. Average rental rates have stayed consistently above JPY1,500 psm.

4. If YK Shintoku were to suffer foreclosure, the nett effects would be a 22% decrease in nett property income, a 10% reduction in NAV and its gearing level would decline from the current 36.9% to 27.4%. 

A 22% decrease in nett property income would probably mean a similar reduction in dpu from my projection here. Based on the current number of units in issue, the dpu would reduce from 2c to 1.56c giving us a yield of 9.45%.  The NAV would reduce from 39c to 35c approximately.  With the proforma foreclosure gearing at 27.4%, Saizen REIT would emerge unscathed and, in my opinion, stronger in its balance sheets. So, if YK Shintoku goes through a foreclosure, Saizen REIT remains a great investment as it has high yield, a big discount to NAV and low gearing.

The CMBS lenders for YK Shintoku, as expected, are dragging their feet and still "formulating course of action".  Why would they want to go ahead with foreclosure when they are receiving 7.07% interest payment now? They are lenders, not property managers or investors, after all.

YK Shintoku's property income is more than sufficient to cover the punitive interest payment due to the default.  So, it is still more positive than negative to keep the status quo.

Presentation slides here.

Saizen REIT to resume FY10 distribution to unitholders in Sept
Wednesday, 12 May 2010

© 2010 - The Edge Singapore

SAIZEN REIT:
Out of woods and resuming cash distribution
Written by Sim Kih, Thursday, 13 May 2010.
Read the article in NEXT INSIGHT here.

Related post:
Saizen REIT: March 2010 presentation.

Charts in brief: 11 May 10.

STI opened higher but declined to close lower at the end of the day. The huge rallies in Europe and the US did not manage to lift Asian markets today, painting a picture of uncertainty with a bearish bias.

STI drops 0.8% to 2,857.67 at closing
Tuesday, 11 May 2010

© 2010 - The Edge Singapore

Courage Marine: BDI higher at 3,707 today. MFI has just dipped into oversold region. OBV is flat.  Immediate resistance remains at 20c. Picture of low volume pullback continues. As the fundamentals are good, I would accumulate when the technicals give me the signal.

Golden Agriculture: CPO declined to close at RM2,505. This continues the downtrend. Things look pretty weak, technically. We have an engulfing black candle today which negated the morning star setup. Buy signal on the MACD has been negated as well. The rising 200dMA might be tested as a support soon if the weakness continues.

SPH: Opening at $3.95 only to move and close lower at $3.88 is bearish. What has been formed is a bearish piercing line pattern as the black candle declined to cover more than half of the previous day white candle. $3.95 is now burnt into the psyche of traders as an important resistance level due to the failure to move higher today.

In summary, for most counters, prices did not move higher and, so, I did not get to sell more at higher resistance levels with the exception of Healthway Medical which I managed to sell off most of my remaining shares at resistance.

I will continue to use any rebound to sell into strength, for stocks with weakening technicals.  I will accumulate when the technicals show signs of bottoming, especially for stocks of companies with sound fundamentals. The market is now a riskier place for long only investors like myself.

Dow 8500 Before 11,500:
Sell the Surge, Suttmeier Says
Posted May 10, 2010 09:47am EDT by Aaron Task
 


Related post:
Charts in brief: 10 May 10.

Charts in brief: 10 May 10.

The STI rebounded nicely today. Personally, I am making use of the rebound to reduce exposure. If the rebound continues tomorrow, I would lighten my portfolio further.

STI advances 2.1% to 2,880.48 at closing
Monday, 10 May 2010

© 2010 - The Edge Singapore

Courage Marine: The BDI is in excess of 3,600 today! Good news for Courage Marine as it closed 1c higher at 20c but on very low volume. If Courage Marine is able to close at 21c or higher in the coming sessions, it would negate the bearishness seen in the last couple of weeks. We have a buy signal on the MACD but its reliability is suspect due to the very low trading volume. Wait and see.

Golden Agriculture: CPO at RM2,538 today means it is still in a downtrend which started in early March. Golden Agriculture staged a nice rebound with price piercing resistance provided by the 100dMA at 55.5c to touch a high of 56c before closing at 55c. Volume is also respectable.  We have a morning star set up, a 3 stick reversal pattern. The buy signal on the MACD is more credible in this instance. My overnight sell queue at 55.5c was done.  Let's see if 55.5c could be overcome and the resistance at 58c tested next.  58c, that's where I would queue to sell again.

SPH: MFI bounced off 50% support, forming a higher low. $3.90 resistance successfully taken out as price closed at $3.95. Volume is respectable and the price might go higher tomorrow to test the next resistance level at $4.03 gap resistance which coincides with the 20dMA. SPH remains the largest investment in a blue chip for me and I made use of the rebound today to offload some, locking in some gains. I might offload more tomorrow if its price goes higher.

CapitaMalls Asia: 4r1g buy signal on the MACD. MFI is turning up from the oversold region and the OBV is turning up too. We also have a valid morning star pattern although a weak one with volume very low on this up day.  There are various resistance levels next if the price continues to move up.  I would reduce exposure at these levels: $2.09 gap resistance, $2.12 support turned resistance and $2.15 declining 20dMA resistance.

Healthway Medical: MFI emerged from the oversold region. OBV continues to decline, suggesting that distribution is underway even though the counter has gone CD. I continue to queue at 15.5c to sell at resistance.

Saizen REIT: Quarterly results on 12 May 10, two days from now. Price closed at 16.5c today with technicals turning very positive. First off and a major development: the negative divergence between price and volume has been negated!  MACD is turning up towards the signal line as we see a buy signal. MFI's higher high is a given while the OBV suggests aggressive accumulation. The only negative is the descending 20dMA which seems poised to form a dead cross with the 50dMA.

Before the price could go higher, the descending 100wMA which is at 17c has to be overcome. This is a very long term MA and is likely to be a strong resistance. Let's see.

Good luck to all fellow Saizen REIT unitholders!

US Futures are looking very green now.  Looks good. :)

Related post:
Charts in brief: 7 May 10.