Market Outlook

 6 March 2021

Dear Fellow Investor,

Despite the 13.6 % correction in the Nasdaq since the middle of February, Warren Buffet’s Berkshire/B closed at a new high.  Investors who are buying Berkshire are shifting  from many of the high flying technology shares such as Tesla and Zoom to more traditional companies such as Kraft, Chevron, Apple, Verizon and undervalued Japanese conglomerates such as Sumitomo.   

Weekly chart of Berkshire/B

On the home front our technology index in the last week has fallen 6 % on low volume, falling in sympathy with the Nasdaq. Unless weekly support breaks down on the technology shares we hold for you such as Inari, I am not concerned.   

The economic background is positive and is being supported by the rise in oil prices and the  rise in finance counters. Sentiment is improving as vaccines are being rolled out. Some of my clients who are physicians have already received their first Phizer shots.

Our Singapore shares have come back to life. This includes OCBC, DBS, SGX and  Parkway Life Reit.

The volatility since the beginning of the year in my opinion has a lot to do with fear of inflation, rise in commodity prices and uncertainty of Biden’s stimulus programs.

These are issues we have no control over but if we select quality well managed companies we can ride the ups and downs and come out ahead.  At least our share selection gives us a measure of control and puts the odds in our favour.

Take care
Bill

Zoo Negara is now open which is a good sign that our economy is getting back to normal.