Volatile markets created some buying opportunities

Markets are pretty volatile in the past few weeks. Yellen is hinting a possible Fed interest rates hike this 15-16 December during FOMC meeting.

The STI index was down 0.89% last friday to 2859.12 points.

Stocks to watch next week:

• ST Engineering - war in middle east may drive demands for weapons
• City Developments - In oversold territory (RSI indicator circled in green, Money flow index circled in red) Recent London land acquisitions showed shift to overseas due to government cooling measures on singapore properties.
  
• Global Logistic Properties - e-commerce driving needs for logistics spaces
• Singapore Post - excellent future prospects with recent acquisitions
• Starhill global REIT - dividend yield of 6.8% at current price of 0.755

Safety in volatile market

Many blue chip stocks have dropped today. Banks are facing an increase number of risks in relation to the economy.

Oil and gas companies and commodities companies had experienced a lower prices on their commodities. This may slow down loan growth in banks and also companies's ability to pay up.

Property stocks like GLP, Capitaland and HK Land, have dropped due to the weakening of the Chinese currency, with fears that a conversion back to Singapore currency will reflect lower profits.

Cargo volumes dropped, indicating a slowdown in overall economic activity. Companies with lesser profits result in their ability to pay back loans. This factor could lead to a slowdown in bank earnings.

The launch of Singapore bonds on 1 October 2015 will also reduce the amount of cash deposits held in banks as close to about $1 billion a month of Singapore bonds will be issued out in October.

Amid volatile markets and a possible correction, these 2 stocks provide safety in volatile markets:

1. M1
2. Q&M Dental

M1

• Oversold
• 6% dividend yield at current price
• Offer cheaper plan to scoop up bottom markets to scare off 4th telco

Q&M Dental

• Aggressively acquiring clinics in Singapore, Malaysia and China
• Closest to becoming monopoly in Singapore dental industry
• price to earnings growth stood at 0.3(PEG is undervalued if less than 1)  after Q2 2015 results

What stocks would i buy now?

After Isetan lost $3.1m due to surging rental and keen competition from other new malls. Its future prospects were faced with challenges of increased online shopping.

Source: http://www.channelnewsasia.com/news/business/isetan-lost-s-3-1m-last/1685270.html

As more consumers move to online shopping, there will be more demand for logistics sector in terms of warehouses for storing goods and courier services to deliver goods.

3 sectors for growth (Online shopping)

• Online payment services
• Logistics and warehousing
• Insurance (to protect online consumers)

There are a few stocks that i see opportunity in but not all of them are cheap at the moment.

• Singapore post - Established a good online platform for online shopping and a leading provider of mail, logistics and retail solutions in Singapore
• Global Logistics Property - Invest and own logistic warehouses around the world, also owned or partially owned by state-run wealth fund
• Mastercard (US. listed)  - Provides to a bulk of online and offline payments around the world

Global Logistic Properties

Source: Bloomberg

After a number of corrections, the price seemed to have reached a level where geopolitical risks seemed to have been factored in.

However, whether this stock has reached the lowest is unknown. However, i am optimistic that this stock will be a long term future growth stock due to the portfolio of assets supporting e-commerce companies.