Morning, its been a long day already with the impending doom of FX and obvious trades meaning hay is made when the sun is shining, having just closed my latest longs on GBP Vs, almost everything.
Now overnight, here's something Bloomberg are missing a story on; China Home Price Drop Spreads to More Cities as Demand Weak (Bloomberg News). With figures coming in as far back as March 2014 with Experts urging that preparations for home price drop needing to be made (Official People's Republic Ministry of Commerce). Following on from my commentary on the declines Real Estate Transaction Taxation Revenues the theme is set to continue. Is it really news? No, although the speed of declines is increasing. Perhaps parties are not aware of the significance in the declines, housing is an essential ingredient for driving the Chinese economy.
For those looking to get the news before its recycled, one would be wise to get on the mailing list for National Bureau of Statistics of China. Today's announcement, Sales Prices of Residential Buildings in 70 Medium and Large-sized Cities in August 2014 has something significant in the fact even affordable housing is under price pressure with an absence of demand. With commercial property sales in decline its no wonder the Chinese Government introduced further stimulus. The 2013 Chinese figures show when compared with the yesterday’s show a trend with wider implications.
With the Fed's news out of lower interest rates for longer than expected, the obvious contrarian play on gold occurred with longs significantly reducing their positions despite some only having acquired them earlier this month. One wonders without support if Gold could be heading towards 1065$/oz. Instability and volatility is required, plus a few more Indian and Chinese buyers that are categorically absent. Gold currently around $1,224.90/oz doesn't bode well for the larger producers. A 1% drop is not something to get concerned about in normal market conditions, but the absence of buyers and sellers very recently raises questions about forth coming volatility. Are players starving the market of speculation to profit?
Caza Oil & Gas, Inc (CAZA) came in well ahead today, the stock will benefit from a significant rerating. On the phone with Ian this morning running through it, believes Caza to be worth around 31 pence conservatively with some longer term value. Perhaps the Muppets are so focused on SOLO et al they cannot see quality. In light of that, I took another long on the pause today!
For those wanting some humour, does anyone notice a trend? RNS Earthport PLC Successful Placing of GBP26.6 million. Monitise PLC Visa Inc. to assess investment stake in Monitise, enough said...
Atb Fraser
The Petra (PDL) coverage appears to have disappeared, http://www.investegate.co.uk/petra-diamonds--pdl-/rns/preliminary-results/201409180700189745R/ With hopes improving of a dividend as the market and PDL improve, one would be wise to consider the Foreign Exchange issues and return of capital employed being dire in comparison to other producers. The turn should be argued as being positive, albeit the overhang over shares won't do anything for PDL until Awal Bank either dispose or declare their support, the latter is very unlikely. As such at £2 (near as damn it) it's hard to find any upside in the current price without the find of another big'un. Atb Fraser
ReplyDeleteFraser been following you on ML & here. Commendable with very accurate coverage why are you only investing on your own still? Are Co's so blinded to talent. excellemt on MONI Cheers Graham
ReplyDeleteFraser- Hi- back in UK now and the razorwire wasn't needed to keep the tartan hordes from getting at my whisky supply. Im glad you played the currency- the polls were close but the spreadbet re the result was heavily on the No side for weeks. No signs of the Horse Hill oil on my lawn either....
ReplyDeleteSome nice results from HUR and CAZA whilst I have been away- the debt held re CAZA seems to be the only fly in the ointment and I agree with you and Ian that they are out of sync with other similar producers in the US. The Scottish issue out of the way should help HUR finalise their discussions too, albeit farmouts seem to take forever now. I did laugh when I saw the Stans Energy statement re the gov offering of their assets to all and sundry- perhaps Stans could give them a 2% cut as a form of estate agent for the sale?? Perhaps they were planning to pay the $118m owed from the sale proceeds- fat chance they will get more than a few million if and when they are ever in a position to sell it again. It did make me chuckle a little though.
Catch up next week. Cheers. The Leggie