PETALING JAYA: Traders, on your mark.
The year 2010 will see more opportunities than 2009, and will be coloured by opportunities, volatility and lots of activity, says Joey Yap, the founder, CEO and master trainer of the Mastery Academy of Chinese Metaphysics.
The year of the Metal Tiger which begins on Feb 14, is personified by metal chopping wood which creates sparks.
“Metal chopping wood creates lots of activity. Yang metal in the first half of the year also creates a stronger impact. Wood controls earth, which is the wealth element in astrology. Hence, the rally in the stock market will continue up to the first half of the year as the roots of wealth are in the first two pillars of the Bazi chart,” explained Yap.
The second half, meanwhile, is forecast to be less aggressive.
Hence, the stock market will see more excitement than the real economy, which Yap says continues to look sluggish over the longer term, due to there being no water element.
“Water produces wood. With lots of wood but no water, this hinders growth. Hence, the recovery image is one that is somewhat artificial. However, I don’t think 2010 will be the year, we pay for all these artificial growth,” he said.
Yap pointed out that the absence of fire in the Bazi chart also indicates a lack of the happiness sentiment. This might mean there is something hidden or suppressed.
“Perhaps people are still not spending and being conservative with their finances,” said Yap.
Sector-wise, as the banking sector is represented by the metal element, Yap still sees stumbling blocks, and said more painful decisions may have to be made.
“Banks will become very cautious, and may be tighter on their lendings. Also, as only metal can produce water, and there is no water, there will be less liquidity,” he said.
The services sector, which is represented by the Hour Pillar in the Bazi chart, looks set to flourish. With the presence of earth (indirect wealth) and wood, these sectors ought to prosper.
Also, fire-related sectors such as technology, oil, alternative energies, mining are expected do well.
On stocks, Yap picked blue chip companies with strong sales to China. As there is a need of water, Yap would also pick water-related sectors such as fast-moving consumer goods companies.
Yap said Malaysia would grow, although at a slower rate.
Malaysia is also in a relatively sweet spot as Prime Minister Datuk Seri Najib Tun Razak is a Yin Wood Day Master.
Yin Wood’s defining characteristics are flexibility and adaptive in nature.
“These are the types who will always ‘find their way’ in life. New policies by Najib will help. Because of this, Malaysia will be better,” said Yap.
Meanwhile, JP Morgan strategist Adrian Mowat advised investors to stay high beta for now, as growth would develop as the dominant style in 2010
He said early 2010 conditions should continue to be very favourable for Asian equities with strong growth, positive earnings estimate revisions, acceptable inflation, ongoing rally in credit markets.
“Stage three of the bull market is an overshoot in valuations as risk-free rates stay low for long.”