Outlook 2021 and Top Buy Stocks(Lists)

Two important lessons to learn from 2020 stock markets are to keep a long-term perspective and the belief that markets are forward-looking. Heading into 2021 we look forward to hopefully a year when the pandemic subsides, lives return closer to normal, and economic recovery picks up. Below are the highlights of the sectors with stock in focus for the year 2021.

1. Semiconductor/Chips: The global Semicon industry suffered its worst year in almost two decades and picking up to return to growth in 2020, according to World Semiconductor Trade Statistics. The group sees Semicon sales accelerating further in 2021. The fastest-growing category of semiconductors in 2021 is memory chips, with forecast growth at 13.3%. As electric vehicles, smartphones, 5G equipments etc all need chips, chips are in great demand. The largest chipmaker in the world is Taiwan Semiconductor Manufacturing(TSM), and other top players including Advanced Micro Devices(AMD), Nvidia(NVDA), Qualcomm(QCOM), Apple(AAPL), and ASML(AMSL). Or Semicon Sector ETF SOXX.

In Hong Kong, related top players including SMIC(981) Sunny Optical(2382), AAC Tech(2018) or Hang Seng TECH Index ETF(3033) 

In Singapore, related tech players including AEM, Frencken, UMS

2. Food Delivery: Virus won't go away at least for quite some time, and home office will be the new norm. It's expected food delivery companies will do well. Companies in focus including Uber Tech(UBER), DoorDash(DASH).

3. Online Shopping and Logistics: Amazon(AMZN), Alibaba(BABA, or 9988.HK), Pinduoduo(PDD), ContextLogic(WISH), WISH is called the U.S version of China's Pinduoduo, just launched its IPO on Dec 16, it traded underwater to its IPO price US$24. and also FedEx(FDX) and United Parcel Service(UPS)

4. Remote Working: Zoom Video Communications( ZM), Cisco System(CSCO), Slack Tech(WORK), Alphabet(GOOGL), Facebook(FB), Microsoft(MSFT)

5. Online Education: TWOU(2U), Stride(LRN), 17 Education(YQ), GSX Techedu(GSX), TAL Edu(TAL) New Oriental Edu(EDU)

Hong Kong related stocks: New Oriental Edu(9901), Koolearn(1797)

6. Remote Healthcare: Teladoc Health(TDOC), American Well(AMWL), Veeva System(VEEV)

7. Online Entertainment: Netflix(NFLX)

8. Consumer Staples: Wal-Mart Stores(WMT), Costco Wholesale(COST), Procter & Gamble(PG), or SPDR Consumer Discret Sector ETF(XLY)

In Singapore, related stocks Wilmar.

9. Insurance and Wealth Management technology companies: Lemonade(LMND) Lufax(LU)

10. New Energy Vehicle companies: Tesla(TSLA), NIO, XPeng(XPEV), Li Auto(LI)

In Hong Kong, related stocks Ganfeng Lithium(1772) which is the top battery supplier to TSLA and other electric car companies. 

In Singapore, there are two companies with very unique business thus give them unbalanced advantages: Nanofilm and Credit Bureau Asia.

SPX Marks the Fastest Bear Market Recovery in History

  Summary of content for the week of  Aug 21:

1. Week 34 major indexes performance;
2. Week 34 US sector indexes performance;

3. Major indexes weekly charts of support and resistance levels;

U.S

SPX index advanced for the fourth straight week. Technology stocks leading the index to a new record high. By common definition, this marked the fastest recovery from a bear market in history according to Dow Jones Market Data. 

Uneven performance. Technology stocks such as Google( GOOGL.O) and Apple(AAPL.O) which are heavy weighting in benchmark indexes were among the best performers. AAPL has 7% weighting in SPX and 8% in the DJI index. AAPL becomes the first company that has crossed U$2 trillion in market capitalization this week, the company announced a four for one split and will be trading ex-date Aug 31,2020. Meanwhile, value sectors such as financials and energy shares recorded declines. Refer to below 11 SPX sector indexes weekly performance table.

China/HK

Mainland China stocks ended the week slightly higher as the postponement of the U.S-China trade deal review. Shanghai SSE index recorded 10.84% YTD return, second-best index after Nasdaq index as shown in my major indexes weekly performance table below. Technically, SSE index has been in sideway consolidation after having a breakout from its major downtrend line. Bulls are in control. 

HSI is just sitting above 25000 level, within its consolidation range. 

Singapore

STI index has been the worst index performer, with negative 21.5% YTD return, a lagger. A lot of room to the upside for it to catch up. Singapore retailers have been net buyer and institutions have been the net seller this year, according to MKES research webinar today Aug 22. Technically, STI's immediate at 2500 then 2400 level. 

Great Sales Shopping List(Compiled)

1) Key Strategy: Focus on top blue chips stocks as when market rebound they will be leading.
2) Time Frame: >3 months
3) Execution: From next week, aggressive to buy in one batch, conservative to buy in batches and from one day to weeks

List 1: Great Sales for Singapore Stocks
Key Stats:
1) STI 10-year High-Low: 3641.65(Yr2018)-2521.95(Yr2011)
2) STI 5-year High-Low: 3641.65(Yr2018)-2528.44(Yr2016)
3) STI 3-year High-Low: 3641.65(Yr2018)-2955.68(Yr2018)
3) Current level 3011.08 is at 56% discount from its 10-year peak and 57% from its 5-yr peak, 92% discount from its 3-yr peak.

Overweight:
1. Banks: DBS, UOB, OCBC
2. Technology: Venture (also can consider AEM and UMS)
3. Defensive and Singapore core Assets: SGX, ST Engineering, SingTel
4. REITs: Areit, MapletreeLog, MapletreeCom, CMT, CapitaCom
5. Local Developers: UOL, Capitaland, CDL
Refer to below latest data:

List 2: Great Sales for HK/China Stocks

2020 China Core Assets top picks:

1.    Wuliangye Yibin(000858.SZ)

2.    Alibaba(9988.HK)

3.    Tencent(700.hk)

4.    Meituan(3690.hk)

5.    ZTE(763.HK)

6.    Xiaomi(1810.hk)

7.    Pina an(2318.hk)

8.    Shimao Prop(813.hk)

9.    Shenzhen Mindray Bio-Medl(300760.SZ)

10.  New Oriental Education(EDU.O)