What a TIGER Year 2010!!

Since the beginning of the year, analyst has predicted what a bumpy and hollistic 2010 it's going to be. Any true to their words, and with 1H'10 just ended, moving forward the second half of the year is slated to be in moderate pace. With M'sia's GDP peaked to over 8% for 1H'10, Bank Negara is expecting the GDP to down to ~6% to close Year 2010.

From Jan'10, KLCI has now risen to its all-time high at 1395pts, +120pts from early of the year. However, market did not come in a direct upward trend (refer chart above). Throughout the year, stocks stumbled to its lowest point at two occasions; one in Feb and another in end of May. And from the latter, the bulls charged up himself and rallied with no turning back. With KLCI potentially going into overbought territory, coupled with poor economic data especially in the U.S and uncertainty still arise in Europe, market will be eventually pull its break and begin its correction mode.

With the underlying data pinning potential downside turn, what would be the best bet (haven't we mention this before since the end of Year'09 where we were so worried about how this year would turn around?) for investors to put their money at, in order to minimize the "expected" risk involved? One basic ground rule is through Portfolio Diversification and this has been the tactic I'm adopting, and gosh... although there were 2 dips in the year, my net returns from stocks still give me +$1,000! My returns peaked at +$1,300 in early Aug'10. The setback was partly contributed by the regional poor economic data plus the selloff across gloves industry. And back to topic of "safe investment", my personal call is to buy-in the lows of glove stocks. These stocks have good fundamental and proven to give decent return especially when the market turns fragile.

Particularly in domestic region, besides investing in rubber, other commodities product that worth to invest in would be in steel. With governments direction pushing into massive construction and infrastructure projects, these supporting materials will be the best beneficiary. In these 2 field, my pick is CSCSteel (pays good dividend and sound financial data) and Sunway (share price comparatively attractive to its peers). Another preferred blue chip company which has just recently announced outstanding quarterly report would be YTLPwr. I'm expecting a potential upside for this share throughout the year, especially once Tanjong Plc completed its privatisation moved. This will eventually diverge some of the power utilities investors to other players; i.e Tenaga and YTLPwr.

Advent International sells its stake in Herlitz to Pelikan International Corporation Berhad

Frankfurt / Berlin. Advent International, the global private equity firm, today signed agreements to sell its 66% stake in Herlitz, a leading provider of stationary products in Europe, to Pelikan International Corporation Berhad, the international manufacturer and distributer of writing instruments, school stationery, office supplies, and printer consumables.

Herlitz is a long established household brand in Germany and has been listed on the Frankfurt Stock Exchange since 1977. Following a rapid expansion until the mid 1990’s, the company underwent a significant financial restructuring in 2001 which included Herlitz’ consortium of banks taking a stake of 65%. In 2005 Advent acquired a total of 66% of the company taking over the stake from the banks and from a voluntary takeover offer.

The acquisition of Herlitz by Pelikan represents a logical step as it combines two leading brands and two complementary businesses. Herlitz has a strong regional presence in Germany and Eastern Europe and well established sales channels, particularly in the food retailing sector. Pelikan has a leading market position in Western Europe, Latin America and Asia and long-lasting client relationships with specialist shops. The transaction will thus open up additional business opportunities for Pelikan and Herlitz."

Bumpy Road of Recovery: Unemployment shoots past 10 percent

WASHINGTON — Just when it was beginning to look a little better, the economy relapsed Friday with a return to double-digit unemployment for only the second time since World War II and warnings that next year will be even worse than previously thought.

Payrolls fell by 190,000 last month, more than forecast by economists, a Labor Department report showed today in Washington. The jobless rate rose from 9.8 percent in September. Factory payrolls dropped by the most in four months, and the average workweek held at a record low.

President Barack Obama called it "a sobering number that underscores the economic challenges that lie ahead." He signed a measure to extend unemployment benefits and to expand a tax credit for homebuyers.

Unemployment at 11 percent would be a post-World War II record. Only once since then has joblessness hit double digits in the United States — from September 1982 to July 1983, topping out at 10.8 percent. "It's not a good report," said Dan Greenhaus, chief economic strategist for New York-based investment firm Miller Tabak & Co. "What we're seeing is a validation of the idea that a jobless recovery is perfectly on track."

2cents: Obviously the bad report came out of nowhere and shocked everyone. However, there has been a saying that our stock market moves ahead of actual market condition (same say 6 months ahead), and judging that D.J still swings around 10,000 +/- 500 pts since the past few weeks, we shall buckled up tight and anticipate a bumpy ride as we head to year 2010...

FDIC announces 99th bank failure

NEW YORK (CNNMoney.com) -- The nation's tally of 2009 bank casualties hit 99 Friday night when state regulators closed San Joaquin Bank, based in Bakersfield, Calif. This was the tenth bank to fail in that state.

The Citizens Business Bank in Ontario, Calif. will assume all of San Joaquin Bank's $631 million deposits, according to the FDIC. Citizens also entered into a loss-share agreement with the FDIC on $683 million of San Joaquin Bank's $775 million in assets.There are about 8,000 banks in the nation, and an average of 10 banks have failed per month this year, nearly four times the number that failed in 2008. This is the highest tally since 1992, when 181 banks failed.

Though 2009's count is still far from 1989's record high of 534 bank closures which took place during the savings and loan crisis, the FDIC revealed there are now 416 banks at risk of failing -- the highest level in 15 years.This year's failures have reduced the FDIC's insurance fund to $10.4 billion from $45 billion a year ago.

One Week Before Q3'09 Ends - Market Makes a U-turn...

NEW YORK (CNNMoney.com) -- Stocks fell for the third straight session on Friday, ending lower for the week, after weaker-than-expected reports on durable goods orders and new home sales sparked concerns about the strength of any recovery.

The Dow Jones industrial average (INDU) lost 42 points, or 0.4%. The S&P 500 (SPX) index lost 6 points, or 0.6%. The Nasdaq composite (COMP) fell 17 points, or 0.8%. Stocks slid in the previous two sessions after having ended Tuesday at one-year highs. Investors reacted negatively to Wednesday's Federal Reserve meeting and Thursday's weaker existing home sales report and oil slump.

The mix of economic news Friday gave investors another reason to retreat after the recent advance. An attempt at stabilizing in the last hour of trading gave out near the close. "Today is the third day that we are seeing selling on higher volume," said Curtis Lyman, managing director at HighTower Advisors. "It's indicative that the market is consolidating after the very nice recovery we've seen."

Stocks have seen a huge spike over the last 6-1/2 months. Since bottoming at a 12-year low March 9, the S&P 500 has gained 54.4% and the Dow has gained 47.6%, as of Friday's close. After hitting a six-year low, the Nasdaq has gained 64.8%.

This week's retreat has left Wall Street at what could be a key inflection point, said Brian Peardon, wealth advisor at Harrison Financial Group. "We could see a new push higher or a much more substantial selloff," Peardon said. "It's just a matter of all the cash on the sidelines and whether the (buy on the) dip buyers decide to come in."

He said that a continued move higher is more likely than a big selloff at this point, but that the upcoming quarterly earnings reporting period will be critical in terms of whether the rally gets another leg up.