As expected the world markets bleed on several issues. But we start to nibbling mildly on Alaqar at RM 1.31 and KSL at 1.71. We believe the market will be soft for the whole week and we will gradually bargain hunt any fundamental sound stocks at distressed price.
Local issues, China slow down, Greece woes and strengthening dollar will lead market weaker. We believe KLCI will try it’s support at 1700. We will buy mildly if we see value in the market.
I think just timing as the government of China has been easing it’s policy to support growth. After the recent run up and sold down in record last week. We believe the short term sentiment will be worrying across the market. Although we also do believe China market will be a great long term destination. We have sold a large position weeks ago and we will buy in back if we see value I’m the market.
As we believe the growth of China market will be continued fiercely. Potential China government may limit and grow its domestic market. Purchases of governmental computers and servers will continue to drive Lenovo growth. That’s exclude its market share development in the international arena. We like it if the price is between PE 15 – 16 times in 2015.
We think all issues persisted and pointing to a weak sentiment. However, we started to discover value in the market. We will buy in slowly at the current level. Anything below 1700 will trigger bigger sell off. We advise invest in value.
We continue our bargain hunting activities today. Air Asia at RM 1.45 is a bargain to us. We added Msports at RM 0.11, MNRB at RM 3.99 and Alaqar at RM 1.33.
At RM 1.65, it has dropped more than 50% since we disposed at RM 3.80. May be something on going we do not know. But at RM 1.65, we feel the price is very fair to re-enter. If price falling further, we will buy more gradually.
Is that something other people know that we don’t know? We see 2nd liners traded in blood. However, we start to see value in the market and will buy in if market further test 1700 support level.
We believe as there are no catalyst in the local front. KLCI will trace Greece development. We believe markets already factored in Greece development. However a sudden impact may emerge as opportunity.
RM continue weakening may spark further sell off. But we still think RM is undervalued due to reasons. Finally HSI will also give clue on KLCI heading directions.
We continue to monitor MNRB, EIG and Affin. We will buy into the market if there is weakness.