This piece of good news will give a lift to Singapore market tomorrow.


HONG KONG (MarketWatch) -- Chinese manufacturing activity improved further in April from the previous month, an official survey showed Tuesday, signaling a "stabilization" of economic conditions at factories. The Purchasing Managers' Index rose to 53.3 in April, up from 53.1 in March, according to data from the China Federation of Logistics & Purchasing. A figure above 50 indicates an improvement in overall business conditions, while one below signals a deterioration. The latest PMI print compared with analyst expectations of 53.5, according to a survey from Dow Jones Newswires.

What is good & cheap still?

wat was sti level in 2008 may?

The Americanos are coming back! The Dow Jones has touched the highest level since May 2008, amid better-than-estimated housing and jobs market reports.

12,984.69

Ernest Lim has done a compiliation of stocks with market cap >$50m, sorted by year to date returns. I.e. these counters have not moved that much this year vs STI and most other stocks.

The criteria is outlined below. To reiterate, the compilation is based purely on figures generated from Bloomberg, with no regard to fundamentals or technicals. He has highlighted the rows which meet the criteria.

See attached pdf.

Attachments
 ernest17Feb12.pdf [93 KB]

Bro, what do you think is the reason?

China animal healthcare, haven't move.

S-chips are making a move -- big move. Look at Qingmei, Eratat Lifestyle, Hu An. etc.
Anyone can recommend the solid ones still lagging behind?

A lot of these stocks will do well if there is a sustained recovery in the outlook of the economy. These are penny stocks that will be played up by syndicates and retail players when the Time is Right! In the meantime, mainly value investors will look to accumulate quietly and wait patiently for the Time is Right.

DMG co-head of research Terence Wong has key points:

1. The inflection point for the STI in the past three crises coincided with the worst quarter in terms of GDP change year-on-year. The current quarter is likely to be the worst for the Singapore economy this year. “If history is anything to go by, the Singapore market may turn around as soon as the first quarter of 2012,” says Wong.

2. For small caps, DMG’s top stock picks are in the technology and construction sectors. “HDD major Western Digital, which was the most severely affected by the floods in Thailand, is recovering much

faster than expected. The component suppliers will thus start ramping up their production in the current quarter,” says Wong. “That is the inflection point I have been looking out for, and should result in interest returning to the tech sector.”                      

3. DMG’s tech favourites include Hi-P International, Nera Telecommunications, Trek 2000 International and Adampak.

Stocks in the construction industry it likes are BBR Holdings, Kian Ann Engineering, KSH Holdings, Lian Beng Group and OKP Holdings. “Given the strong pipeline of contracts, especially from the government sector, the construction players will not go hungry even if we head into a recession,” Wong says.

Points to bear in mind.

1. The forward PE could change in a major way with the next quarter's results, and the outlook guided by management.

2. Some stocks are mico caps, and the low PE is justified.

3. Notable big cap in the list is China Minzhong. One day, it may prove to be a bargain at this low price of 83 cents.

Eratat Lifestyle 1.4

Yamada Green 1.7

Kinergy Ltd  1.7

Sinopipe Hlds 1.7

Sunvic Chemical 1.7

Hu An Cable 1.8

Foreland Fabrict 1.9

Combine Will Int  2.1

Sino Grandness 2.3

Ue E&C Ltd 2.3

Ziwo Holdings 2.4

Wee Hur Hldgs 2.5

China Minzhong 2.5

Hey, an Xmas gift is attached here. Open it .....

It's from Ernest Lim --- his compilation of some SGX listed stocks which are trading at less than 7x next year's earnings.

He said: "FYI, before China Minzhong & Sino Grandness recent appreciation, they were trading at or less than 2x nx year PE.

"Nevertheless, do be aware that some stocks which are trading at low or high PE may have justifiable reasons thus this can be used as a starting point but not a stand alone investment methodology."

Ernest Lim CFA, CPA is a remisier at CIMB Securities and writes a blog: ernestlim15.blogspot.com

Attachments
 Companies trading at less than 7x next year PE 28 Dec 11.pdf [22 KB]