China fuel shortage may persist in 2008 -industry

BEIJING, Dec 21 (Reuters) - China may again experience a fuel shortage in 2008 if Beijing maintains a tight lid on domestic oil prices, an industry association said, a situation likely to keep the country's diesel imports high.

The world's second-largest oil market suffered through widespread diesel rationing in October and November, after refineries cut output to stem looses as global crude prices surged above $90 a barrel.

"If refined oil prices are not freed up and crude prices stay high, private refineries will continue to stand and watch, leaving the supply burden on two state companies," the China Petroleum and Chemical Industry Association said on its Web site www.cpcia.org.cn.

"New refining capacity will not be ready immediately, (existing) plants are unable to carry out thorough maintenance, making safe operation the weakest link in the supply chain."

CPCIA has the support of retired top executives of state oil giants Sinopec Corp (0386.HK: Quote, Profile, Research) and PetroChina (0857.HK: Quote, Profile, Research), the Web site shows.

China's independent oil processors, supplying 10 to 15 percent of the country's 7.5 million barrel-per-day market, had cut production drastically, a main factor behind the supply squeeze that eventually forced Beijing to raise pump prices in November, the first increase in 17 months.

State refiners had to boost diesel imports to nearly record levels, second only to the United States, supporting global prices at a time of peak winter demand. (For details see [ID:nSP24624]) (Reporting by Chen Aizhu; Editing by Edmund Klamann)

Reuters

Happy Holidays,

Marketswimmer

The Market Kicks off the Holiday Season with a BIG BANG!

Markets were closed for the Thanksgiving holiday on Thursday, and Friday trading closed early at 1 p.m. Eastern time. Expectations for this holiday season had been lowered following drops in consumer confidence surveys.

"Take the consumer confidence readings, they're just numbers from surveys," said Paul Mendelsohn, chief investment strategist at Windham Financial Services. "But now we're finding out what consumer spending is really like, so the weekend numbers will be very important for the market."

The Dow Jones Industrial Average ($INDU 12,980.88, +181.84, +1.4%) rallied 181 points to finish at 12,980. The S&P 500 index ($SPX 1,440.70, +23.93, +1.7%) gained 23 points to 1,440, while the Nasdaq Composite ($COMP 2,596.60, +34.45, +1.3%) rose 34 points to 2,596.

Remember, this is a short session and a lot of traders are shopping for their holidays. Nevertheless, let's celebrate the impressive market move by watching a Youtube Chinese music piece - Huo Yuan Jia (adapted from a Chinese Kung Fu movie):

Enjoy,

Market Swimmer

P.S. Forget about trading for a moment, I just watched a movie - "The Family Man" - starred by Nicolas Cage (released in the year of 2000) on NBC. It's an old one, but pretty good. A hedge fund manager "Jack" turned into a tire salesman, married with "Kate", having two kids. A personal note, little Swimmer just got an offer from a big hedge fund in NYC, I am a little worried about it. Anyway, please check it out if you have not seen it:

I missed the beginning, see more on my "YouTube" page:
Market Swimmer YouTube.

PTR enters major stock indices

PetroChina Co Ltd (Symbol PTR in RS stock market), China's largest oil refiner, was today added to the Shanghai Stock Exchange series indices and the China Securities Index series indices, including the CSI300 index.

As of last Friday's close, PetroChina shares had shrunken almost 25 percent to 38.32 yuan from an opening price of 48.6 yuan on November 5, when Asia's most profitable company was listed in the Shanghai bourse.

Last Friday, PetroChina shares had a total market value of 6.14 trillion yuan, accounting for 23.2 percent of the total market value of all shares listed in Shanghai. PetroChina has left the Industrial and Commercial Bank of China (ICBC) far behind. Previously the heaviest weight in Shanghai, ICBC shares on Friday accounted for only 7.93 percent of the total market value of the Shanghai exchange.

Calculated on the closing price of the Shanghai Composite Index on November 16, or 5,316 points, PetroChina took up 1,097 points. In other words, if PetroChina's share price changes by 1 percent, the benchmark Shanghai index will move 10.97 points.

Calculated on the closing price of the CSI300 index on Friday of 5,007 points, PetroChina weighted 111 points. That means if PetroChina share price changes by 1 percent, the CSI300 index will move 1.11 points.

Based on PetroChina's closing price of 38.82 yuan last Friday, a price change of 0.01 yuan would cause the Shanghai Composite Index to lose 0.31 points. Supposing PetroChina had been included in the index on Friday, its gain of 0.91 yuan that day would have led the index to go up 28.21 points.

Please book mark this site, the only reliable source for Chinese Stock Market.

To take your free training sessions, check the Education on the menu bar.

Or do your Holiday Shopping (menu bar) on AMAZON and WIN $10,000!

(Based on China Daily November 19, 2007)

BIDU - A BUYING OPPORTUNITY - CITIGROUP SAYS

CITIGROUP SAYS BAIDU.COM IS ATTRACTIVE BUYING OPPORTUNITY, MAINTAINS BUY

Citigroup analyst Jason Brueschke says Baidu.com (BIDU) shares lost 30% of value in five days. He says the sell-off appears to have been caused by Cisco Systems' (CSCO) disappointing outlook last week for its U.S. enterprise business, but says Baidu's China search market has little fundamental correlation with near-term outlook for US router demand.

Brueschke notes that the company guided for accelerating fourth quarter revenue growth, and posted very strong third quarter fundamental metrics. He says BIDU remains his top pick in China Internet for 2008. He has a $425 target price, based on target multiple at a 70% premium to China Internet peers, mainly due to BIDU's higher-than-peers EPS growth prospects and potential of China's nascent search market.

Guru View

**

The stock market has reversed after first testing new
highs (for the week) on Wednesday following the FED
decision - only to dramatically sell-off on Thursday
violating short-term support.
This breakdown in price is starting to confirm the
bearish COT charts of the Nasdaq 100 and Russell
2000.

It looks like we are headed for a test of last week's
reaction-lows. Here are the support levels:
Dow Jones- 13,400 | 134 for the DIA etf
Russell 2000- 790 | 78.5 for the IWM etf
S&P 500- 1,490 | 149 for the SPY etf
NASD 100- 2125 | 52 for QQQQ etf

Even though it declined for the day, the Nasdaq-100 price
chart continues to look the most constructive out of all the
indexes. The intermediate trend remains UP unless we
start to break below critical support at around 2125.

If the above support levels are taken out, the US stock
market is going to start to paint a bearish trend. Consider
the breakdowns in financial companies such as Citibank.
Also keep in mind that the Russell 2000 closed below 800
today. Last time that happened, the RUT reversed in the
very next session - to the upside. We'll see if the bulls
show up this time around...

COT Report

Source: U.S. Commodity Futures Trading Commission (WWW.cftc.gov)

Commitments of Traders:

The Commitments of Traders (COT) reports provide a breakdown of each Tuesday’s open interest for market reports in which 20 or more traders hold positions equal to or above the reporting levels established by the CFTC.

Index	Trader Group	Friday 10/19/07	Friday 10/26/07	Difference
Dow Jones Index Composite	Commercials	-39	-56	-17
NASDAQ 100	Commercials	2509	3321	812
S&P 500	Commercials	53142	51518	-1624
Russell 2000	Commercials	3717	3283	-434

After the drastic sell-off, NASD is only index the smart money has increased position last week. Look at the VIX (it's not shown here) the smart money bought, betting the volatility will increase.

Enjoy,

Mkt Swimmer

China Fire - CFSG - is on Fire!

Quite a few friends asked for more picks. When I looked at my survey, indeed stock pick is the most popular category in this board. How could I forget that? After all the most people want is what I need to do more.

For a good investor, you need to constantly look for investing ideas. I remember a few years ago when Katrina stroke I searched my trading log and notes, tried to find similar events happened in the past, such as earth quake, etc. I found out that after the natural disaster like that, the mobile home business was very popular, so I picked up CHB, it went up 20% in a few month.

So why am I telling you this? Is there any similar event developing? Right, the wild fire in California. Unfortunately half million people had to evacuate and several people died from this devastation disaster. However, what equipment they have to buy after this? Fire detection, fire system control, fire extinguishing equipment? These are a few items I copied directly from CFSG's company profile!

http://marketswimmer.blogspot.com/2007/08/some-of-you-might-be-amazed-how-could.html

This stock happens to be the stock I recommended a few weeks ago when it was around $8, and some friends wondered why I like this stock. At the time I pointed out it had low PE, etc. But now it looks like a real bargain then. Can this stock go even higher? I will provide more information.

Maybe I should change the sub-title of this blog into "Swim into the deep inside of the far east (China) to explore unexpected hidden treasure (or tiger in a movie)!" Any suggestions?

Thanks for reading,

Market Swimmer

Mid-Day Report

CNBC is saying CPSL (a Chinese Precision Steel Maker) is taking share from foreign steel makers. What else can you expect? Some estimate the forward P/E ratio of this company is about 2.0, so if it were to catch up with the US market average forward PE of 16 - 20, the share price may appreciate 10 times in the next couple of years.

Remember, China will be hosting 2008 Olympic Games, that's why all the Chinese stocks are "red-hot" right now. Hold every thing you bought till 2008!

Year End 2007 China Precision Steel, Inc. Earnings Conference CallWed, Oct 17, 2007, 9:00 am Eastern

Listen to the archived event audio

Have fun,

Mkt Swimmer

Milestones - Welcome New Contributors - Market Pulse

It's time to buy SOLF!!!

We have blasted through several milestones today:

- We passed 3,000 unique visitors (more than 3,000 people have visited our site)
- More than 8,000 page views (Sitemeter predicted monthly page view of 23,760)
- Google Analytics shows totally 4,247 visits came from 48 countries/territories from 853 cities around the world
- Up to now (9:00 PM CT) we have had 309 visitors for today, the historical high; record traffic of 113 visitors per hour at 2:00 PM

Please join me to welcome a few new contributors Wizz007 and ChinaIPO. They are the fresh blood of this board, will provide posts with the best quality and highest professionalism to our readers here. Please feel free to make comments, ask questions and participate in discussion.

What else happening around the world?

- Sorry bachelors - richest Chinese woman got married today. Yang Huiyan, a former Ohil State Univ. graduate, est. worth of HK$69.21 billion after her company went to IPO a few days ago. Google her if you want to see her wedding photos, spreading on internet like a wild fire.
- The first baby boomer, Kathleen Casey-Kirschling (born in Philadelphia on Jan. 1, 1946, at 12:00:01 a.m.) received her Social Security check today. 3.2 million baby boomers will follow her foot steps next year, the Social Security's caseload will be 84 million people in 2030, payment will reach more than $2 billion per annual and the system will be broke 5 years later, according to USA Today.

Market Pulse:

** - Oil broke out to new highs, settling at 85.22 on the
WTIC. Support is now at $83 for the WTIC and
$64 for the oil ETF (USO).

** -Interestingly, the Gold ETF (GLD) also broke out,
above 74.6 to close at 75.14, while the Gold contract
did not break out today and remains under resistance
at 760. ($GOLD)

** -The stock-market tested short-term support today:
SPY - 154
IWM - 82
DIA - 139
QQQQ - 52.5

As long as we hold these levels the uptrend remains intact.

Enjoy your day,

Mkt Swimmer

Life Jackets

Boy, Halloween came early this year. 500 lb pumpkin drop and Al Gore won Nobel Peace prize. Dow went up 200 points then dropped in a dramatically fashion. While Wall Street talking about buy, buy, buy in one minute, sell, sell, sell right after, if you follow CNBC to buy or sell stocks, you will buy at the market top and sell at the market bottom. All swimmers need to take a life jacket. Where is the jacket, you may wonder?

Well, it turns out, you and I don't have to try to figure out the market ourselves, the Guru has already figured out for us. If he figured out, you think he will tell us? No.

Okay, if he doesn't tell us, what's good it gonna do for us. Hmmm, I wonder what Guru is going to do with the information? Right, right, he is going to trade on it. If he make a move, he leaves food on the table. Where to find Guru's trading information? Swimmer, you always claim you are a smart money follower, where were you?

Well if you check my post, not long ago, you would find this on Sunday:

** Stock market

The rally is alive and well, as the majority of the indexes are closing at record highs for 2007. The only exception for now is the Russell 2000, which is just shy of its 07' highs. Pullbacks and periods of consolidation are not out of the question, but the overall market TREND is clearly up. Meanwhile, the COT charts are sending mixed signals. From last week, there was evidence of a large amount of commercial buying of the S&P 500, that went hand in hand with a large amount of commercial selling of the NASDAQ 100 - the index that is leading the current rally . There was also some evidence of commercial selling in the Russell 2000 while the Dow Jones COT chart remains largely unchanged. In conclusion, while the trend continues to point up there is little sense in being bearish on the market. However, in light of the recent commercial selling, especially in the NASDAQ 100: warns me to stay on the cautious side. Typically, when you see big declines in commercial net-position for the NASDAQ, the market either corrects or consolidates in the intermediate future. (1 - 5 months out)

Okay, it's not difficult to find out, isn't it?

That's the reason for the 500 pumpkin drop on the Wall Street yesterday! The commercial sold off NASD index future very badly last week. I warned you, didn't I?

Gee, I wonder what the commercial is doing yesterday... or right now. Don't worry, SEC is going to ask them to disclose all their trading position on every Friday... which happens to be today! Well, well, well, I only wish to know where to find. You don't need to.

Just make a bookmark on this page, you will find the number and Guru's comments on it. Make a lot of sense!!!

Okay, the number was just out, I even don't know what the future is doing, I only care what Guru is doing. I would say, sit tight, fasten your belt, enjoy the ride. If you really want to sell short, sell CKR. Look at the chart you know what I am talking about.

I will add the Pumpkin Drop and Gore Video on later.

Enjoy your day,

Mkt Swimmer

Okay, here you go, 500 lb Pumpkin Drop an Al Gore: