While on my way back, I heard from the radio that Li Ka Shing mentioned that he is worried about China's stocks - Shanghai Composite and HSI riding to uncharted zones and climbing to extremely high PE. On the other side of the action, China's central bank said on Friday that it would raise both interest rates and banks' required reserves.
I am 101% certain that Monday is going to be a blood bath. A market downturn ahead which was long overdue. The market went up on Wednesday and Thursday defying gravity. This late reaction is going to harm many people on Monday, first will be the Uncles and aunties whom tried to ride the market uptrend wave, second will be the contra players and third will be speculators.
Long term wise, I believe who ever has cash will benefit fully because bargain will be throw on the table. After a series of downturns, positive market outlook for the year is nevertheless intact. Maintained Sembcorp and Comfortdelgro. Hold on to defensive high dividend yield play for the time being.
In mutual fund's point of view, I believe I am going to let go First State China at ROI 17%. The rest will depend on how much the market shed on Monday. I believe the money may well moved to Thailand and Korea Funds which are trading at a more realistic and emerging PE.
As of current time, DJ up around 50. Even a rally in Wall Street is not going save or rather mitigate this coming heavy correction.
Any opinion herein is made on a general basis and is not an inducement to trade.