Hmm... lets say a person owns some O&G counters. Will oil futures trading above $80/barrel a good or bad thing? Good in the sense that maybe the counters will earn more EPS and higher dividends. Maybe bad too because when oil up, alot of costs will also up. Inflation hits the wallet.
So, if you're holding O&G counters, do you wish to see oil up, or down?

I welcome oil to hit USD80, and hope that gold also moving along with the oil. With $80, if our government try to increase the petrol price, they can only do that on RON97. Another thing is, even if the oil price down and our govt couldn't be bother to reduce the petrol price like previously, I rather that both the citizen and the govt suffer together. In actual fact, our govt should welcome the oil price going up, else where will their money come from? As for the citizen, eventually we all will need to face the same problem when our petroleum = 0. So, let's start learning it now

Suppose to be a good thing if you own O&G counters as long as Crude Price stays above their threshold line for the duration the O&G companies can make money and invest in discovery and refinery.

Crude Oil fluctuates very fast. Some O&G may not even get the chance to get profits after their investment, crude went down already. Therefore a lot of O&G companies saw their revenue sink like crazy and share holders value went down the tube. Those people who invested before Oct 2008 still in deep hole because Oil companies aren't reporting much profits.

Opec controls Oil pipe. They are content long as Oil stays between US60- US70.
If Oil goes US70-US80, they are very happy. If Oil breaks above shoots up to USD 100 or more (with little actual demand), they will worry because they know it won't last, consumers automatically cut back, slower growth and people look for alternative energy.

Higher crude price is very bad for consumers because we have to pay higher price for petrol, and other energy related stuff, which ultimately cause other commodity to rise (eg. food, raw materials, transportation). Look at what happened last year. Crops have become fuel, food prices went up, poorer countries went on riots. Malaysians went mad because Govt can't subside anymore.

14th Ogos CI - 1195.17 then went down to 1163.79 on 21st Ogos = - 31.38 (hope it rite...)

It she going down somemore next week ?

Does it matter? Does CI really represent the health of Malaysia economy?

Don't you guys think after they've changed out the underlying counters that reflecting the new CI, this new index is all a bit skewed?

Yap, but the question how is she like next week ?

Dunno man.. CI has a mind of its own. Some people think it traces Dow, some think it traces China SSE. It difficult to predict CI. No pattern seems to be working for CI.

Yes, the last 5 trading session, CI seems to be trending down, while others regions are going up.
If others are down.. CI most likely wants to be down more than up.

If you're long, no choice but to stick to fundamentals and valuation only.
Since they don't allow shorting, just keep buying on those dips if prices are good.

This post has been edited by danmooncake: Aug 22 2009, 01:49 AM

Thanks chief, at least i have a foundation & basis for next week. i'm in the process disposing my penny holding / shifting to small-med cap. Looking at CCB but seems this guy flat fly dip then flat again then it goes again again...

Missed da' boat at panamy....next monday the ex-date.

This post has been edited by mazda626: Aug 22 2009, 01:58 AM

looks like monday gonna be a bull day!! enjoy the weekend~

9505.96 +155.91 +1.67%
2020.90 +31.68 +1.59%
1026.13 +18.76% +1.86%

That's it! Bulls won! There....I said it.

Both DJ and SP500 broke through the resistance level.

Oil is at the highest level now: US$74 barrel.
This is definitely at the re-testing US75. Is this good for longs?
I'm not so sure because we ran up so fast, so high and with little demand.
The fall is definitely going to hurt.

Next week, we will most likely see some pullback due to profit taking.
What's next.. is anybody guess.


This post has been edited by danmooncake: Aug 22 2009, 05:18 AM

Haiz doomcake, as a bear you should have more faith in history and less faith on people. I'm still bearish

If you're planning CI index counters, then you may want to look at CI performance. If you're going to buy non CI index counters, you have to look at your individual counter performance... CI no longer works as a good gauge liao...

If inflation kick in, your money and spending power will be reduced without your notice, any gain in your O&G stocks might not able to offset your reduced spending power, so how can it be a good news for individual front? Your gain in O&G stocks just to offset the reduced spending power, so back to square one, so it is as good as your stock never goes up and spending power remain the same. So it is back to square one only.

Even if I am holding O&G stocks, I do not wish to see oil price goes up too much because inflation threat is a very serious issue.
Price stability is one of the most important factor that enable economy to flourish, down too much no good, up too much also no good.

Hadn't we just feel the pain of pumping our car Rm150 per tank last year (2007 when petrol price is at Rm2.70/lit)

Also at current environment, O&G sectors are not all will be 100% benefitting from current oil price goes up, because the run up in oil is more due to speculation, reduced supply (OPEC cut production to meet the lower demand to support the price), so for O&G sectors locally that provide offshore service, platform, oil rig, may not 100% benefitting from it (yes it does, but not as same as last year), as those oil service company will only flourish if there is huge demand for oil field construction. Locally, we don't have O&G company that are drilling oil from the ground.

Oh.. I'm still bearish. But, this week, gotta to give the cup back to the bull.
Will play again next week.

One of the reason why CI can't move much because even PNB has said local PER is at high side, which they might look overseas for some opportunity.

So near term, valuation is richer than other bourses, so upside room become limited.

We need CI components stock to report earning improvement before CI can go to a new higher level but for some stocks like MISC, Axiata, Maybank, Petgas, their earning report still under a lot of stress, which difficult to see a lot of improvement in near term.

No further liberalisation and Msian shares will retreat. Najib announced many things but on the field, I do not see vibrancy at all. Iskandar is also behind schedule and no big money has poured in consistently. Pritning more money and they are worried of Ringgit. Getting more investors to Iskandar, they must first liberalise further.

Msia is a land pandering to racism and nationalism to unlimited extent. The current price of many blue chips is really rich. Chasing it up is not a wise move. Buying overseas shares is much better.

not to worry too much. let nature take its place. next week market will go up for sure. malaysia boleh n merdeka.

Chyaw did point something very obvious about the CI in answering mazda626 question.

If people are trading on up or down performance of their stock based on CI but yet many do not know their counter is non-CI, it obvious, the CI should not be the tool to use as benchmark or as some kind of a leading indicator.
KLSE CI is not like the Dow or S&P500. Not sure if the some of these people is aware of this fact or not.

Infact, I'm surprise so many people here who are trading in KLSE always look at the Dow or S&P500 as leading indicator or possibility that KLCI may or may not track.

This post has been edited by danmooncake: Aug 22 2009, 12:16 PM

Ya. Thanks all.

us is the train head of all the world stock market directly or indirectly. i hv been read a book few years ago, its said ci is link closely with singapore market and australia market, but tis 2 market i am sure also link with dj.

we are in globalisation of bisness environment now. investor is looking for bigger picture of economic, but trader/daily traders are not.