Trading volume was disappointing as it only increased slightly in this last week when the market rallies after the rebound. The average daily trading volume last week was 750 million shares and the previous week’s average was 662 million. Average daily trading volume below 1billion shares are considered weak. The market was slightly bullish because of positive leads locally and internationally. Locally, industrial production and export numbers were growing on-month and jobless rate fell. World Bank confidence about having a positive GDP in year 2010 and increasing foreign participation in the local equity market boost confidence further.

Internationally, governments in developed nations are confident that the global economy is improving and Australia is the first G-20 nation to raise key interest rates since the start of the global financial crisis more than a year ago as the government believes that the emergency low rates are no longer needed. In the world’s largest economy, manufacturing increases and jobless claim declines.

Daily FBMKLCI Chart

The US Dollar continues to slide against major currencies, continuing its down trend. This again has pressured prices of commodities to increase. Price of Gold in COMEX continues to make historical highs and is currently at US$1,050 an ounce, increasing 5% in a month. Crude Oil in NYMEX continues to stay around US$70 a barrel. Rubber futures in TOCOM slightly rose month-to­-month but it jumps about 6% last week to JPY$214.80 a kg. However, Crude Palm Oil futures in Europe Store Exchange declined from EUR 2,200 per metric ton a month ago to EUR 2,030.

The FBMKLCI is well supported by the short term trend. The benchmark index continues to stay above the short to long term 30 to 90-day moving averages despite several pullbacks from the uptrend that started in April. A major correction is yet to be seen in this 6 months bullish trend. Momentum indicators are about to turn bullish again after mixed signals in the past few weeks.

The RSI and Momentum indicators are starting to move away from the middle level and the MACD indicator is about to cross above its trigger line or 9-day moving average. ADX indicator has just started to increase again, showing good strength in momentum last week.

The Bollinger Bands started to expand again with the FBMKLCI penetrating the top bands after testing the middle band two weeks ago. The same situation (the expansion) happened exactly a month ago and the FBMKLCI made new highs for the year. Therefore, we may expect the same to happen again and this time the projection is 1,280 points before it finds the next resistance. The average daily trading range is the same as the previous week.

Price Map - Direction Forecast

The immediate support and resistance levels are still at 1,196 points and 1,230 points respectively. The FBMKLCI is currently testing this resistance level for the second time in a month. The market is set to test newer highs because of the strong bullish reversal and breakout. The next resistance level is between 1,280 and 1,300 points. However, if the market fails to make new highs and the FBMKLI falls below the 1,196 points support level, then the next support level it is going to test is at 1,150 points.

Looking ahead, the leading Ichimoku Cloud indicator continues to contract last week and this indicates that the support for the uptrend is getting thinner. Being a leading technical indicator, a major trend reversal is not expected until the cloud bands cross. Therefore, there is still a chance for the market to maintain its uptrend at least for another month.

The market sentiment is still bullish and the FBMKLCI is expected to rise in the short term to the next resistance level between 1,280 and 1,300 points. This is only valid if the benchmark index stays above the immediate 1,196 points support level. In the longer term, a major correction is expected to take place once the index moves into the next resistance level. My price map/direction forecast chart for FBMKLCI remains the same as last month.

Therefore, current opportunity is only good for short term traders who trades short term profits because the market is expected to test new highs but with a limited upside. However, accumulating shares for the long term (3 to 5 years) may be too risky at current levels as prices are way above the long term average. Opportunity for long term accumulation only exists when the market pulls back to its long term average or below it (a 200-day moving average can be used as a benchmark).

So, longer term investors have to patiently wait for a major correction to happen. My longer term

forecast (1 year) for the FBMKLCI when it goes into a major correction is still at 900 points and therefore accumulating shares when the index moves to this level or slightly above provide a better low risk opportunity for longer term investors.

The meltdown resulted in the collapse of several large banking and financial institutions in the United States and Europe due to weakness originating from the mortgage and mortgage backed securities markets.

However in Asia, many were not too worried about the property market due to the regulated control of the banking system by their country National Bank and the well-established and matured property developers.

As a result of planned developments and sale of property, the Asian property market has remained healthy, despite the country’s Gross Domestic Product (GDP) contraction of 6.2 % in the first quarter of 2009.

As an indication of the strength of the property sector, the National Property Information Centre (NAPIC) recorded higher transaction volume of some 4.0% compared with a decline of 17.8 percent in 4th quarter of 2008.

In its study, NAPIC also recorded 79,149 transactions valued at USD 4.701 billion in 1H 2009 with the Residential property sub-sector being the most dominant. Total transaction volumes were 63.8% while total transaction value was 55.1%.

The development of residential property remained promising with upward trends in the completion and starts category but dwindling numbers in new building plan approvals.

Currently, by 1H 2009, the residential property sector recorded an existing supply of 4,230,328 units with and incoming supply of 544,926 units. Planned residential supply is recorded at 669,554 units.

In the demand scenario for the residential sales performances there were lesser units that were launched into the market in the past quarters. However, sales performances during the nine months were between 70% and 85% since the first quarter of 2007.

There were also signs that the Asian property market was affected by global economic and financial crisis but the market has remained healthy overall.

This is an opportune time for business owners to seriously consider investing in commercial properties, most notably shop houses, office lots and factories, as a means of expanding their operations, utilizing surplus funds or simply to diversify their investment portfolios. Investment in private real estate such as houses for rent may also help positively diversify investment portfolios.

Commercial properties are a good buy at this juncture because business owners can capitalize on the significant drop in mortgage rates which was preceded by some national bank’s cutting of the overnight policy rate to an all-time low of 2% per- annum in February 2009. Borrowers will be able to enjoy the prevailing low rates and save substantially on interest payments by leveraging on the low mortgage rates and lock in at this level for the tenure of their loan.

For risk conscious investors, current alternative investment instruments may prove to be beyond their risk profile in this bearish environment. To mitigate risk, investors should balance their portfolio with a selection of differing investments. As such, some banker and investor believe that commercial properties offer a more stable rental yield. As the latest property induces have shown, demand for commercial spaces has remained relatively constant and unabated compared to other investment vehicles. Properties continue to be excellent assets to hedge against inflation when prices start to rise on the heels of an economic rebound.

While it is ideal for investors to buy at the right time, the right place, and at the right price, most of the time it is all about striking a balance. An estimated 3 million square feet of office space as well as another 3 million square feet of retail space will be added to the Kuala Lumpur landscape this year as a result of launches from the past couple of years. Investors will have ample opportunity to select from diverse locations and types of spaces, and also reap the benefit of numerous freebies offered by developers ranging from free legal costs to discounts in prices. They will also be privy to an array of financing schemes.

Business Mortgage One Account (BMOA) is specifically designed for SMEs and business owners who in the course of their operations will have periods of surplus funds. The BMOA provides a very smart solution for business owners to enjoy savings by using cash in their current account to shorten their loan principal amount, with the added benefit of redrawing with no penalties charges from their surplus payments.

In situations where the SME wishes to ensure his funds are fully optimized for the operating cycle of his business, our SMI One Account is the perfect business mortgage solution because he gets the best of both worlds — funds in his operating account can generate interest credits for the benefit of his business mortgage outstanding.

While we are mindful that property purchases are long-term investments and being fixed assets, are not as liquid as investments in equity; the return on property investment may not be lower than equity investments.

A clear violation below its neckline support at RM0.60 may see a downside breakout with a potential target to RM0.37 as measured from the distance between the recent high of RM0.825 to the neckline support. However it must overcome its strong support at RM0.47 which corresponds to a classical support and the 61.8% Fibonacci retracement from its Oct 2008 low to its recent June 2009 high. Immediate resistance now is at RM0.66 which also coincides to its 50-day moving average followed by a stronger resistance at RM0.715.

Thus a correction may be expected at any point of time for IOI Corp. If there is a break below the recent low of RM4.42, there are chances to see a slide towards its next technical support of RM4.00. Resistance is at its recent high of RM4.86 and a break above it may see IOI Corp resuming its uptrend towards its next target at RM5.15.

As it continues to notch up 52-week highs, investors finally recognize this as a growth stock. We have revised our price target to 60 cent, continuing to recommend a BUY.

Seasonally, the Apr-08 quarter is the weakest quarter in a year. Yet, revenues grew 28.7%YoY and were also up 3.9% QoQ on seasonally low sales volume. The reason is that sales in the Feb-Apr 08 months last year were affected by inflation taking a severe toll on consumer spending; hence 4Q-08 sales formed a low base for comparison. Operating profits rose 76.1% YoY and 10.3% QoQ. Operating profit margins improved sharply to record levels at 19.7% compared to 14.4% in 4Q-08, a weak quarter. NTPM’s raising of product prices by 15% in Jul-09 to offset rising costs proved fortuitous as material costs subsequently fell. Net rose a strong 76.2% YoY and also 22.1% QoQ.

Operating profit margins improved from a year ago due to recycled newsprint prices continuing to fall from depressed levels in preceding quarters. But a continuing fall in subsequent FY10 quarters is not imputed in our forward forecasts.

Higher working capital requirements in inventory costs and receivables boosted net gearing, which rose from 0.15x in Apr-08 to 0.158x in Apr-09 but this has eased from 0.20X in Jan-0-9 and is manageable.

FYE Apr010, sales are forecast to continue to climb at 11.9%, driven by the full year effect of the price increase and a marginal 4% volume gain. NTPM’s dividend yield is sustainable at 5.5% after the 4-for-5 bonus issue.

Recommendation

We have raised our forecast for FY EApr010 earnings to RM51.7m, also representing

+11.9% growth. Valuation remains undemanding at 8.7X PER. The share’s defensive quality comes from its retention of an astonishing stranglehold on the facial tissue market in the country with 70% market share, and the low price stature of the product. The share price has risen 70.4% in the YTD period, but the promised yield is still at least 5.5%, at our recommended threshold yield for income stocks, giving an anticipated 12-month total return of 28%.BUY.

To some poor investors, the markets actually started to crack in early 2008 and then “changed” rapidly in the second half of 2008. But then you thought had a good, solid mutual or unit trust fund managed by a big institution with other great products printed on their glossy brochure. The equity fund you bought at the peak in the previous Bull Run was a solid investment you thought it could do no wrong.

Well, you thought you did everything right and you subscribed the popular buy-and-hold mentality. You didn’t believe that the buy and hold mentality benefits the fund institutions that manage the assets and the sales agents more than you. So the expert who is paid to take care of your investment failed to spot the downside despite all the red flags because he or she was stuck comfortably in the world of decoupling and you watched the fund slide into darkness, even buying more units on the way down to average down your losses.

When the dust finally settled for a while and even with the dead cat bounce you have seen so far, you are still stuck with about 30% losses and part of it belongs to your retirement funds. Suddenly, even your private banker who had lost all the credibility isn’t as confident or brash as he normally is. Your financial planner has also been avoiding you.

You have learned that you need several disciplines in place to improve your long term investing performance. Managing downside risk is one important trick to learn. You have realized that you need to be truly diversified by investing in different asset classes such as equities, commodities and currencies on the planet using different investment styles.

More importantly, you have realized that getting the big picture right is critical. How do you diversify when all asset classes are moving, in tandem? This was a key many faced at the height of the financial crisis in 2008, when all asset classes were collapsing together, but is a concern that remains today whether we like it or not.

Any of our clients who have benefited from our valuable advisory services over the years will tell you that we have long held concerns over the increased tendency for the values of different asset classes to move up or down) in the same direction at the same time regardless of all the beautiful fundamental stories hyped by the shill in the brokerage industry.

We never subscribe totally to long-only or traditional investment positions for our client investment strategy. We know from past experience that alternative investment strategies with low correlation equities and bonds can add tremendous value to any investment portfolio ranging from conservative to aggressive (different investors have different risk tolerances, investment horizons, etc).

Many geniuses in town have continued with play down the role of alternative investments as a true diversifies for any global portfolio at any time to the extent of labeling them as purely speculative.

Client interests should always come first d we have no choice but to grow up. Local investors on the street have been brainwashed for decades that the stock market and traditional investment vehicles are the only realistic ways to build wealth. To invest all your wealth in the stock market either directly or indirectly, that is foolishness, in my view.

I know that there is still a lot of skepticism about the alternative stuff mainly due to lack of exposure. To some institutions that are a little behind the curve, alternative investments should not be viewed as pure imams and a threat to their traditional business models.

The recent global stock rebound was just another dead cat bounce. Never believe in everything that is written here. You should have your own sense of the markets and your own opinions oldie kinds of opportunities you’re looking for. To the mind of this financial writer, global stock markets will chart new lows over the coming months. This is based on our own work. I’m far for being perfect and I may not be right about everything, but I’m willing to hold and defend my independent view.

To some traders, markets have continued to move mysteriously. At the time of writing this missive, the stock markets have continued to deteriorate technically. However, China seems to be an exception in this – for now. I could offer all sorts of other predictions, but what’s the point.

Investors should always look through a different lens, and ask if there’s anything positive we can take away from another round of turmoil? As for long-only equity strategy, it’s not all gloom. Selectivity is going to be important. Are profits guaranteed? Of course not!

In the financial game, there are always the markets are heading next as our usual game plan is to be able to make money regardless of economic and market conditions at various risk levels. I think that the next few weeks and months will not only be very interesting, but also very important. Patience is a virtue as markets could remain trapped in a trading range for weeks before the next big move.

So what? Although action by governments around the world has ensured that the global economy will stay in business, the reality is markets and environments will continue to surprise you on the downside and the upside.

Warren Buffet is famously quoted as saying, “Only when the tide runs out do you see who’s been swimming naked.” It is always better to anticipate risks than to ignore them. Informed caution is our area of expertise and our strong absolute performance in 2008 is a testimony of our hard work.

The local official acknowledged that because the local medium income social stratum accommodation basic solution, possibly withdraws from the stage center after the suitable room. Expert had reflected that Shijiazhuang promotes this year first batch after the suitable room, over a thousand sets of bitter experiences abandon buy. Expert pointed out that surpasses the national stipulation after the suitable room profit 3%, causes the fixed price super elevation.

The local related department responds said that although development enterprise for its subordinate enterprise, but this batch after suitable room price sensibly, also has not discovered the false report phenomenon, therefore is impossible to reduce prices. This year first batch meets coldly after suitable Shijiazhuang promotes this year first batch after the suitable room, suffers abandons buys the crisis.

According to expert introduced that this city first batch after the suitable branch is two estates, respectively be peaceful park two issue and Nanling plot, located at this city urban district most side on. Others said that beginning the peaceful park two issues and the Nanling plot, the altogether more than 3000 sets of housing, Shanghai buys already the dew weak sign.

Two plot even prices decide as 2680 Yuan/square meters, part of estates have even amounted to 2800 Yuan/square meters, only compared to neighbor ordinary commercial housing low 200 Yuan to 400 Yuan, the peaceful park two issues supply 2389 anterooms publicly, only then 1070 household Shanghai bought, arranges the number to elect Fang Zheyou to be short 333 households. Nanling plot Shen Gouzhe reflected that also has abandons buys.

This batch are referred to after the suitable room profit exceeding the allowed figure pointed out that “Shi Jiazhai Character (2009) Economy is suitable home price instrument of ratification” according to the Shijiazhuang Price Bureau, the peaceful park two issue of volume fractions are 2.5, the soil-rent value according to 1,500,000/Chinese acres, the financial cost according to 6% annual interest rate computation, the government charge part calculated according to 100 Yuan/square meters, its item cost approximately is: Land cost 900 Yuan/square meters, Jianan cost 1000 Yuan/square meters, in addition expenses and so on earlier period design, reconnaissance, project total cost approximately 2280 Yuan/square meters.

But present’s selling price is 2680 Yuan/square meters, the project profit margin is 17.5%. Stipulated according to the country, developer when development after suitable room, the profit do not surpass 3%. Except the last year building materials price high factor, the present profit was still a suspect to exceed the allowed figure.

But in May, this city real estate department’s data demonstrated that multi-layered commercial housing even price 3117 Yuan, after suitable room even price 2116 Yuan. Contrasts the above price, expert believed that the Department concerned is in “hits after the suitable room advertisement, sells the commercial housing the price.” expert disclosed that peaceful park two phase of development enterprise – Shijiazhuang lives in contentment the property development management limited company, is this city housing safeguard and the real estate administrative bureau subordinate enterprise, such “the fathers and sons relations” possibly pushed the high house price.

Expert said that buying homes contract provision: The vendee is suitable the room to this set of economies to have the limited property right, do not carry on the hiring management. Such suitable room price has been too economical to the developer. Although, Nanling plot developer by no means housing administration bureau subordinate enterprise, but because the price is too high, this plot Shen Gouzhe and peaceful park two issue of Shen Gouzhe the abatement claim, and requests to be clear about the property right question.

The Pricing department calls the price superior commercial housing. However, the local related department believed that above after the suitable room fixed price, the ratio is close to the commercial housing to have the price superiority. Shijiazhuang Price Bureau management charge place Department Head provides on July 25 the refresh data demonstrated that is apart from the peaceful park two contract 300 meter estate prices respectively is: Bright sun blue city present room 3700 Yuan/square meters, Phoenix forward delivery housing 4200 Yuan/square meters. Sun Kexin said that when the Pricing department initially fixed a price, the reference constructing housing cost is a standard, but non-peripheral commercial housing price.

The Shijiazhuang Price Bureau cost investigation team shows An Yuan two issue of constructing housing cost audit report showed that the peaceful park plot B area housing cost (including tax) is not each square meter 2348.59 Yuan, the C area housing cost (does not contain tax) is each square meter 2473.77 Yuan. Shen Gouzhe believed that if by this computation, the B area and the C area housing profit also surpasses 13%.

The real estate management department acknowledged that the fixed price is high According to the local media reported that in June, this city commercial housing even price 3300 Yuan, but reporter not yet obtains this menstruation suitable Fang Junjia. Regarding this, the Shijiazhuang housing safeguard and real estate administrative bureau Assistant Commissioner Xiao Xiangbao acknowledged that this time promoted was formerly higher than after the suitable room fixed price, “the volume fraction was low, the building materials cost rise, was the fixed price high principal factor”.

Expert acknowledged that the peaceful park two phase of development enterprises are firmly in the bureau the subordinate enterprise, “, but I may say responsible, this project has implemented the public tender, if has the evidence to demonstrate that some people increase the cost intentionally, we will pursue the responsibility severely.”

Moreover, regarding the limited property right view, expert explained that Shijiazhuang rented the housing and the economy inexpensively is suitable the housing administrative center to explain said that limited property right i.e., if after obtaining the house property right, might transfer immediately, only want passed through the government price department to handle jointly with the real estate management department fixed price, sold for tallies after the suitable room purchase condition family.

Expert said that after 2007, Shijiazhuang fulfils exactly these stipulations, the contract has not indicated the house-owner to have the right of inheritance, has the negligence truly. On July 27, the Shijiazhuang Audit bureau manages in the construction mouth to indicate specially appointed that the Hebei Province audit hall is reexamining this batch after the suitable room construction cost, “the result has not come out”.