Ernest Lim's investing blog

Unique insights into SGX small caps

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Markets – diverging signs from technicals and fundamentals. What should we do? (4 Apr 2022)

el15

Dear all March has been a roller coaster month. Hong Kong market, represented by Hang Seng index touched multi-year lows around 14-15 Mar and has rebounded approximately 21% from the intraday lows. S&P500 performed well too with a third consecutive weekly rise. With reference to my writeup (click HERE) published on 6 Mar 2022, I mentioned that a) Odds are likely of a downward push first I mentioned that based on chart, odds are higher for a downwards move for both S&P500 and STI, to retest the previous support around 4,115 – 4,222 and 3,138 – 3,200 (with 3,175 a […]

Markets may continue to be volatile but also present valuable opportunities ahead (6 Mar 2022)

el15

Dear all We are two months into 2022. How is your portfolio doing? With reference to my writeup (click HERE) published on 17 Feb 2022, I mentioned that STI is likely to face headwinds in the near-term and SG banks’ share prices are likely to peak around 7-18 Feb based on past observations.   Coincidentally a) STI peaked on 17 Feb. In fact, STI has tumbled 6.9%, or 239 pts from its intraday high 3,466 on 17 Feb to close 3,227on 4 Mar. Last Friday’s intraday low was 3,208. More about its chart below. b) Banks – DBS peaked on […]

STI is up 10.1% YTD; may face profit taking in the near-term (16 Feb 2022)

el15

Dear all STI has been on a tear since the start of the year. With reference to my write-up published on 5 Jan 2022 (click HERE) citing that Asian indices are likely to outperform that of the U.S. market in 2022, STI has indeed notched strong year to date (“YTD”) gains of 10.1% to close 3,439 on 16 Feb 2022. This outperformance is especially stark if we compare it to S&P500’s -6.1% YTD returns. As I have shared with Lianhe Zaobao on 9 Feb 2022, I personally feel that our STI is overbought in the near term with several near-term […]

Will Singapore stocks outperform U.S. stocks in 2022? (5 Jan 2022)

el15

Dear all With reference to my market outlook published on 7 Nov (see HERE) citing our Singapore market may face near term profit taking, STI dropped 201 points, or 6.6% from 3,242 on 5 Nov to close at 3,041 on 30 Nov. As we start 2022, various investment banks and research houses have put forth their views on how the various markets will perform. In this write-up, I will share how the markets have performed in 2021 and my market outlook in 2022.   How did the markets perform in 2021? Based on Table 1 below, it is evident that […]

STI – having closed at a record YTD high, will it continue higher? (7 Nov 2021)

el15

Dear all With reference to my market outlook published on 3 Oct (see HERE) citing opportunities in our Singapore market, STI has soared 191 points, or 6.3% from 3,051 on 1 Oct to close at a year to date high 3,242 on 5 Nov. Will STI continue to march higher, or will there be some profit taking?   Very briefly, my personal view is It is likely that STI may face some profit taking in the near term, attributable in part to the following factors: a) With reference to Figure 1 below, MSCI Singapore index will undergo a rebalancing in […]

STI at 3,051 – Presents some attractive opportunities (3 Oct 2021)

el15

Dear all With reference to my market outlook published on National Day (see HERE), both STI and Hang Seng have hit their highs on 10 Aug and 11 Aug respectively before dipping. Based on Table 1 below, S&P500, Hang Seng and STI have fallen 1.8%, 6.1% and 4.0% respectively since my writeup. Table 1: Indices’ performance since my last writeup Source: Ernest’s compilations Amid the recent weakness, you may be wondering whether it is a good time to accumulate on weakness. Before we get to this, let’s take a look at the indices’ charts.   S&P500 closed 4,357 Based on […]

My thoughts on Sing Medical Group’s possible share transaction (29 Dec 20)

el15

Dear all Sing Medical Group (“SMG”) announced on 18 Dec 20 that the Company is currently in discussions with a third party regarding a possible transaction involving the Company’s shares. The discussions are preliminary and there is no certainty or assurance that such discussions will progress beyond the current stage or that any transaction will materialise as a result of such discussions.   Why am I interested in SMG? My personal view is that at $0.315, given a potential share transaction scenario, the risk reward seems favourable. Please refer to my basis and the risks as highlighted below: 1) Past […]

City Dev falls nine out of ten sessions; near Mar 2020 low amid oversold RSI (2 Nov 2020)

el15

Dear all, Since 19 Oct 2020, City Dev has fallen nine out of ten sessions with a cumulative drop of 20%. City Dev closed at $6.20. Let’s take a look why this City Dev has slumped and why it has caught my attention.   Reasons why City Dev has underperformed The below list of likely reasons is not exhaustive. It is just based on my personal view what may have caused City Dev’s underperformance. 1) Concerns over how much support is required by Sincere Property Group Concerns over how much support is required by Sincere Property Group (“Sincere”) flare up […]

Singapore – Asia’s worst equity market YTD, any opportunities ahead? (29 Oct 20)

el15

Dear all It is less than a week from the U.S. election. U.S. markets are understandably jittery. S&P500 has fallen 316 points, or 8.9% from its intraday high of 3,550 on 12 Oct 2020 to touch an intraday low 3,234 on 30 Oct 20. In fact, S&P500 has tumbled 195 points or 5.6% this week. S&P500 closed at 3,270 on 30 Oct. The media has written extensively on the risks surrounding U.S. election since months ago hence the election event risk is hardly a new one. Examples of risks which media has written about is the possibility on contested election […]

Recent weakness provides accumulation opportunities (9 Sep 20)

el15

Dear all Based on Table 1 below, U.S. indices have fallen between 5.5% – 10% from the close of 2 Sep to 8 Sep. Nasdaq led the decline with a 10% drop. These are interesting times indeed! Why do I say so? Read on below. Table 1: Performance of various indices from 2 Sep to *8 Sep 20 Source: Ernest’s compilations (*STI and Hang Seng are based on 9 Sep closing prices) In my personal opinion, this recent U.S. market weakness provides accumulation opportunities for the well prepared and for those who have been waiting on the side-lines to accumulate […]