Asia Morning Analyircs: 120510 : Determining the moves

Dear readers

Despite a slight pre mature call for a day technical rebound, which came through on the Monday session, it is noticeable that we have had the party, people celebrated over it, and we are back to business. The question looming over market at the moment is, why did the. ecb pour out so much money, when this is a situation of a begger who is already in debt, is borrowing money to solve its problem?

Reflecting on this, market certainly took the bailout negatively and considered this is socialising risk amongst the region. Interesting enough, market, again, is demonstrating pockets of strength that is supporting levels and provide a buffer for further downside.

It must be noted the strength on the US front looks promising, as job outlooks
are improving. Consumer and manufacturers are leading the US out of the bottom. However, it also appears state government and local governments are also struggling to finance their budget.

On the china front, things aren't looking too good either given the high Level of risk aversion due to the inflation outlook and overheating concerns.

Gauging the direction at the moment will be more important as market will head into pockets. For near term, we may expect increasing volatility but a lack of direction.

GFA remains to be a seller in medium term over the outlook of the global economy.

To keep it short for today, if you wish to discussion any issues, or queries relating to our views, please feel free to contact us on gfainvestment@gmail.com.

Ongy out.

Asia Morning Analytics : 100510 EURO SAVIOUR

Dear readers

An eventful weekend with everyone spending time with your mother whilst the EU ministers ploughing through possible measures to contain their contagion problem that is inflicting pressure amongst the globe. Ending with EU ministers target to inject money into the system as an attempt to stabilise the currency. And its debt market, this will certainly become the highlight for the week!

Although our call for technical rebound seems premature last week, the bounce clearly is coming by this week, with the euro's attempt to save its last minute contagion. A question we should ask, however, is the credilbility of such plans, and would merely pumping cash into the system will achieve the desired effects? This will certainly depend on the model being used and the measures employed to avert this crisis alone.

Given the highly likely tech bounce today, a quick snap and run opportunity is present. However, GFA maintains a short to medium term bearish outlook for the EU foldout. Pending on those questions being answered, it is highly likely the contagion may continue as the structural issue of the problem yet remains unresolved.

As at this stage, it does appear the larger EU countries will be the loser for the whole game, as a mean to stabilise the region.

Anyway, to keep it short today, GFA maintains a buy rating on heavily punished stocks on a relative basis. Port related stocks are also attractive.

Ongy out.