Monday, February 28, 2011

Terrible February - Portfolio Plunges As Bad Things Happen

The portfolio lost a staggering $3,400 in value during the past month and this brings the year-to-date portfolio loss to slightly more than 10%. Ouch! The Straits Times Index during the month dropped below the 3,000 level, supposedly on fears that the turmoil in Africa will spread throughout the region, pushing oil prices higher. Incidentally, I predicted that the 3,000 level will be breached and it has happened within my define time frame. No prizes for guessing right.

Closer to home, for those of you living under a rock, inflation as measured by the CPI rose 5.5% on-month for January. This exceeded most private sector economists' forecasts, and the government has had to raise its forecast for the year to 3-4% from 2-3% previously. Curiously, the inflation figures were announced after the Budget was revealed. 5.5% inflation makes the goodies that are to be given out look minuscule, compared to the bonuses that ministers and civil servants will be getting for record growth (at all costs) in 2010.

Portfolio-wise, a few of the companies have announced their full-year results during the last week of February.

1. Action Asia: Managed 14% growth in revenue and announced dividend per share (DPS) of 1 cent.
2. Auric Pacific: Revenue shrank 5.9% but recorded a FY10 profit from a previous loss. 3 cents DPS.
3. C&O Pharmaceutical Tech: 1H11 revenue, earnings up about 5% but no dividends declared.
4. China Animal: Revenue up 35% but earnings down 24% on higher tax. DPS of CNY2.2 cents
5. GMG Global: Revenue and earnings surged. DPS of 0.3 cents declared
6. UOB-KayHian: Revenue up 10% but earnings up 22%. 9 cents DPS declared!

I am still awaiting the results for TPV Technology. So far, I am happy with what I can see. And since coming back from my overseas trip, I am itching for some more action in the stock market. Radar mode on. Going forward, I expect March to be more or less the same as February. The turmoil in the Middle-East and Africa does not look to be stabilizing, giving more reasons for people to stay out of stocks on cost push inflation fears. When people head for commodities, equities will suffer. I am hopeful that everything will turn around somewhere down the road so that 2011 will be an up a bit year.

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