QDII Funds and FTSE ST China Index add buzz to S-Shares. We expect the interest in S-Shares to sustain in 2008, bolstered by the influx of QDII funds as well as the introduction of the FTSE ST China Index.

The FTSE ST China Index also opens opportunities for the implementation of a wider suite of products, such as derivatives based on S-Shares, adding to the buzz surrounding these stocks.Focus on the Consumer and Manufacturing sectors. Among the universe of S-Shares, we are bullish on the consumer sector, for its ability to leverage on China’s strong consumption growth, and the manufacturing sector, for its strategic advantage of having a low cost manufacturing base.

Our stock picks are: Cacola Furniture International Ltd (BUY, Fair value estimate of S$0.75), Man Wah Holdings Ltd (BUY, S$0.99), China SportsInternational Ltd (BUY, S$2.48), and Pacific Andes Holdings Ltd (BUY, S$0.87) for the consumer sector, and Bright World Precision Machinery Ltd (BUY, S$0.80), Dutech Holdings Ltd (BUY, S$0.535), Midas Holdings Ltd (BUY, S$1.85) and Midsouth Holdings Ltd (BUY, S$0.90) for the manufacturing sector.

singapore stock market showing signs of distribution

short term weakening signs are there : STI up yesterday and today but most small mid cap stocks cannot sustain the upward momentum…..and most close near day low on high volume….potential signs of distribution better be cautious when trading my friends

having said that, i would like to add that the rebound this time seems to have put the brakes on the downward move few weeks back, meaning that i would more eager to re-enter when stocks pull back to near recent low

one thing i like is that most stocks’ parabolic signal finally turned positive in the past 1-2 days after been in negative zone for >10 days since the sell off started.

so for those stocks that pull back in the coming days, as long as their parabolic stays positive, i will still be interested to re-enter again.

Stocks in U.S. tanked for a fourth day out of five on Friday, ending a forgettable week that saw financial stocks being hammered due to growing subprime problems and the technology heavy Nasdaq Composite Index losing almost 7%. Wachovia Corp, the nation’s fourth-largest bank, said in a regulatory filing that it expects loan losses of as much as $600 million in the fourth quarter. This sparked further selling of embattled financial stocks.

The Dow Jones Industrial Average lost another 223.5 points, or 1.7%, to 13,042.7, giving it a weekly drop of nearly 4%. Of the Dow’s 30 components, 24 ended in the red, led by IBM Corp. and General Motors Corp. both of them losing about 5.5%. The S&P 500 Index also fell 21.07 points, or 1.4%, to 1,453,70, dropping 3.7% for the week.

Despite an unexpected decline in the U.S. trade deficit in September, which the Commerce Department attributed to a surge in exports, investors chose to focus on the negative news. The U.S. dollar continued its downward path, dropping about 1.75% against the Japanese yen as financial woes on Wall Street took their toll on stocks. A bleak consumer sentiment survey further raised concerns about U.S. economic growth. The consumer sentiment index released by Reuters and the University of Michigan is now at its lowest level in 13 months. The decline in consumer sentiment could lead to a grim holiday sales season for retailers.

The Nasdaq Composite Index fell 68.06 points, or 2.5%, to 2,627.94. The technology-heavy index has declined 6.5% since last week as the tech sector experienced another sell-off session.

Even the high-flying Google Inc. was not spared, with the Internet search engine dropping 4.2% to $663.50, down sharply from the intraday high of $747.24 hit just two days.

In commodities market, oil futures saw volatile trading before closing up 86 cents at $96.32 a barrel amid concerns about supply problems and the weakening U.S. economy.

Gold futures finished slightly lower, down $2.80 to $834.70 an ounce, but still posted a gain of more than $26 on the week, as U.S. dollar weakness continues to provide support for Gold prices.