by | October 1, 2013 · 12:21 pm

Government Shutdown!

The VIX was up 10% yesterday and 10% on friday. Now it is at a high level. After the markets closed, the S&P was down only 0,6%. The S&P now have a quarterly gain of 4,7%. I will follow the vix very close this week. Normally, when the vix is so high, we will see a big sell off in the stock market. Washington D.C have a huge impact of the worlds stock exchange now.

The federal government will shut down for the first time in 17 years as the Congress failed to break a bitter budget standoff over the presidents health care law. Asian markets rise despite shutdown.

This is the first US government shutdown in 17 years. Next date to have a look at is October 17. USA won`t have enough money to pay all of it`s bills sometimes between Oct. 22 and Oct.31. 800.000 federal employees is out of work today. Millions of people are to work without pay. The US army will still be at work. The police will still be on the streets. Markets seem unbothered by that.

As the shutdown in well know, investors will focus on thirt-quarter earnings reports. According to Factset data, the stock prices of the S&P stocks rise and the earning growth are trending in the opposite direction. The estimates for the third quarter call for only 3,2% growth. Down from 3,8% in the second quarter. Stock prices follow earnings, so that can prove problematic!

News today: ISM Manufacturing PMI at 10:00am. Tomorrow, Fed chairman Ben Bernanke will speak at 3:30pm. Looking forward to that. It seems like the vix are rising too late compared to S&P. As you can see below, the vix is now below 17, but looking back to may this year they goes in opposite direction.

VIX 30.09.2013

SPX 30.09.2013

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | September 30, 2013 · 1:00 pm

The biggest threat to this bull market

Investors tend to listen to Washington D.C more now than focusing on individual economics and corporate fundamentals emanating from different financial offices around the world. People fretted over whether or not the FED would start tapering or not, and now everyone is shocked by the decision Ben Bernanke did; no tapering.

Finally, the decision of no tapering is over, so now people can start to buy stock again. Or…… What is the problem now? What do we have to fear? Now, people are panicked by the possibility of a government shutdwon, because of the partisan impasse on the budget and debt ceiling limit.

Stocks went down last week on a light volume. VIX rise and we are near the 50-day moving average in the index. It seems like investors are waiting for a rally. Which means; no fear. We have been in this situation before, and this will hopefulle be no different.

Do you remember the fiscal cliff in desember last year? Well, nothing happend. It will be a deal, and then we will move on again. Government shutdown sounds like a scary thing, but it isn`t. Since 1975, we have had 17 of them.

History tells us that the politicans will discuss and compromise very quickly, and the average shutdown duration is 6,4 days. Remember what Ben Bernanke said when he was not tapering: “Upcoming fiscal debates may involve additional risks to financial markets and to the broader economy.”

Credit default swap (CDS) prices for U.S. Treasury notes aren’t giving us any warning signs. CDS are trading at 23 basis points compared to 41 for the last three years. History tells us that during the last two shutdowns, the stock market didn`t move. The biggest threat to this bull market is not the government.

Today is the last day of september, october has always been a challenging month in the stock market. Smart money will probably look for this to change. I will follow the index when it touch the 50 day moving averange.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | September 27, 2013 · 1:56 pm

Where is the bull?

Where is the shiny bull? That`s the question if you don`t know where to invest your money. BRIC is well known, but is it other opportunities than the BRIC`s? Yes, it is. The International Monetary Fund estimates that emerging markets will grow two to three times faster than those of developed nations in the coming decade.

I was looking at different cases and have identified three more emerging markets that represent rich opportunities for investors. This is emerging markets that no other people are talking about. It’s time to start looking beyond BRICS! There’s a whole new world out there. Have a look at this:

Czech Repubic

As I have mentioned earlier, Europes P/E is 10, and is very attractive. Czech Republic has a projected GDP growth rate of 21,1% by 2017. It`s a good market for specialist retailers, and sales in this sector is CZK 103,244.9 million in 2011. It`s expected to increas to CZK 366,014.3 million by 2016. Food and grocery is the main earners, followed by electrical and electronics. Furthermore, it is expected that the latter will generate annual sales of CZK61,920.7 in 2016.

Peru

Take a look at this; GDP growth of 27,4% from 2013 – 2017. Peru is perfect for food and drink speciality manifacturers. They account for 33,4% with sales of PEN19,134.9 million in 2011. The three fastest growing specialist retailer categories are apparel, accessories and luxury goods. This sectors grow by 7,71% and food and grocery grow by 7,24%. Electrical and electronics grow by 7,02%. Construction industry expanded by 18,4% only in january this year.

Malaysia

This is better than China. This Asian country is predicted to rise it`s GDP growth by an astonishing 24,8% by 2016. In 2011, food and drinks was their speciality retail with sales of MYR18,907.2 million in 2011. It is expected to be a huge increas in the sales of music, video and entertainment, and that is the quickest growing categories in Malaysia in 2016.

There are more interesting cases in the emerging markets that should be on our radar, but I consentrated on only three of them right now. I will talk about three other interesting investments opportunities later. I told you earlier that P/E in Europe is 10, and in USA it is 20. But I am alerting you right now: P/E in Indonesia is 30!

Today I will look at this news: Personal Spending & Core PCE Price Index at 8:30am, Revised UoM Consumer Sentiment at 9:55am.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | September 26, 2013 · 11:43 am

The next HOT stocks

When Facebook (fb) went to the stock exchange may 17 last year it plummet and had a huge problem from day one. In june this year, the stock was worth only $24 a share. Since june fb has skyrocket! Right now the stock is just below $50. What a bull! A shiny bull!

It`s not the only ecommerce stock with great success. What about Google, and what about Apple? I love them both. You already know their success story, but is there more to come? Yes, it is. I will keep an eye on two stock right now. Twitter and Alibaba is the next big thing.

Alibaba is a huge company from China with great success with their ecommerce business. The Alibaba IPO will be a much much larger deal than Twitter. The market value of the Twitter IPO is expected to be around $15 billion, while Alibaba is expectet to be around $100 billion. The Facebook deal was estimated to be $104 billion.

Alibaba include Tmall.com and Taobao Marketplace, and their profit in the first quarter this year rised to $668,7 million. Last year the number was $220,5 million in the same periode. They increased their quarterly revenue by 72 percent which is $1,38 billion.

Alibaba will help Yahoo too. The valuation of $100 billion in Alibaba should be a great deal for Yahoo (YHOO) who have a nice 24% stake in the ecommerce giant Alibaba. But relax. It`s too early to even think about buying IPO stocks now, because it`s just in an early prosess.

It`s not gonna be this year. If so, it will be at the end of 2013. Probably early next year, because Alibaba is trying to avoid certain regulations. Hong Kong Exchange does not allow Jack Ma (founder and the executive chairman of Alibaba.) to have dual shareholder voting classes, but NYSE does. In addition, they have not yet selected lead bankers, nor an exchange.

Dual-class and related share structures are permitted in the United States and on NYSE, but not in China and on the Hong Kong exchange. Both Google and Facebook have dual-class listings. It gives the owners of the company greater say on how the company is driven.

If Alibaba chose New York, it will be a setback for the Hong Kong Exchange, which is ranked as the worlds largest market for IPO from 2009 to 2011. Twitter and Alibaba is two secrets I will look for now.

This is stocks you need to follow in the future, because most of the stocks in the US is too high now. Investors will not earn much the next years, but they will not lose much eighter, and the market will probably go sideways for years to come. That`s why I say stockpicking is very important now. News to follow today: Unemployment Claims & Final GDP at 8:30am, Pending Home Sales at 10:00am.

European markets, commodities and the overseas market is the markets I will follow the next years to come. It`s much better to be in those markets than ending up beeing wiped out in a huge correction. I don`t think it is a vicios bear market in the US, but it`s not a bull market either. Look for the right quality stocks! Take a look at the Facebook (fb) stock below.

What a nice bull! A shiny bull!

A nice rally in Facebook

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | September 25, 2013 · 12:27 pm

Where to go now?

A lot of investors are confused now. Despite the poor market behavior, and the seasoning weakness, the volatility is still very low. The market remain fearless! And that is at the ATH (all time high)!? (SPX is down 1,8% from it`s ATH) P/E for the USA is 20. In Europe it`s only 10! You know where to invest.

Draghi said he will pump a lot of money into the European banks if needed. That statement will push the gold prices up, and resistance for the gold is still $1400. I think the producers are glad to see a stabile gold price, because they are often signing contracts only once a year.

Normally, the gold prices goes up when the dollar goes down, but sometimes we have seen their both are going down in the same direction. That`s unusual. A rally in the dollar could probably push down the gold price, and maybe down to $1000.

If the gold prices goes up to $1500, the cost will also rise. As the goldprices have declined for a long time now, many miners have to cut their cost. So, stabile goldprice is good for the mining companies.

The European economy has emerged from the recession, but the growth has still very little momentum and remains dependent on the demand from Brazil and China. In addition, the European sector is very sensitive to the decisions made in the white house. Many things can still happen with the Syria case. Investors don`t like war.

So far this month, hedge funds are up 1,7% while SPX is up 5,7%. Warren Buffet called the FED; the worlds greatest hedgefund in the world. Funny! When FED is beginning to taper, the markets will go down. If the interest rates goes up and if the bond market falls, the FED will continue to print money. I will follow these news today: Core Durable Goods Orders at 8:30am, New Home Sales at 10:00am, Crude Oil Inventories at 10:30am.

dollar

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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