It looks like a relief rally to me. After suffering through the worst week ever in the stock market, it’s only natural that we got a big bounce today looking at the big news from Europe and US. and it's about time.
However, it still has to be seen if the banks will resume lending to each other; it won’t help struggling companies make their earnings estimates and it won’t prevent home prices from dropping further. Is a depression averted ? Definitely. But a recession averted? Probably not.
We basically saw an emotional reaction to an emotional market. All investment firms will shout the bottom has been reached (they have to make a living), but that has yet to be seen. There are still many challenges ahead.
I believe the fellow is talking about the property market and not stocks...
I am certainly holding at the moment for at least another 10% rise on the stock market before I start selling but it's obvious the market won't have too many days like yesterday. I'm still optimistic that things will rebound moderately in the next few weeks with a spike up when we get rid of Bush and associates...
Unfortunately for some the two are very much correlated.
In last month's Capital Weekly (issue 149 I think) they show a graph with the two together (HSI and CCI) to show their relationship. The two matched fairly well with the rise and fall of the housing CCI approximatly 6 months following HSI trends.
One of our members has stepped forward with a challenge.
I'll be announcing it shortly.
In brief -
Predict HSI value on the 25th of Jan
Predict Centanet's property index for the week of 25th of Jan
Cash prize and bragging rights are at stake.
I just had 4 real estate agents call me offering me 15% discount on HK East properties, 15% off from August pricing! (sellers desperate) Told them to sit back, wait for the big 50% drop.
Things are swinging my way fast...