Pump and Dump

I was wondering if what happen to Cockatoo coal's share price today
is a typical of pump and dump action, cashing out on coal stock hype!

Cockatoo down as much as 8%

What is Pump and Dump?

A scheme that attempts to boost the price of a stock through recommendations based on false, misleading or greatly exaggerated statements. The perpetrators of this scheme, who already have an established position in the company's stock, sell their positions after the hype has led to a higher share price.

This practice is illegal based on securities law and can lead to heavy fines.

The victims of this scheme will often lose a considerable amount of their investment as the stock often falls back down after the process is complete.

Traditionally, this type of scheme was done through cold calling, but with the advent of the internet this illegal practice has become even more prevalent.

Pump and dump schemes usually target micro- and small-cap stocks, as they are the easiest to manipulate. Due to the small float of these types of stocks it does not take a lot of new buyers to push a stock higher.

Claims about how a stock is set to break out should be met with a considerable amount of caution. It is important to always do your own research in a stock before making an investment.

Source: investopedia

Runge Lists on ASX at 11% Premium

MELBOURNE -(Dow Jones)- Shares in mining consultant and software group Runge Ltd. (RUL.AU) listed Tuesday on the Australian Securities Exchange at an 11% premium to the price they were issued at in the company's recent initial public offer.

Runge first traded at A$1.11 compared with an issue price of A$1 in the IPO, giving the company a market capitalization of A$135.3 million.

Runge intends to use the funds it has raised to add to recent acquisitions as well as chase organic growth in a sector it says has a favorable outlook, with the China-driven commodities boom sparking strong demand for mine planning consultants and mining technology.
-By Alex Wilson, Dow Jones Newswires

RUL closed at $1.18

Update

• Runge IPO was a sucessful one. Share price at this moment is $1.10. It went up as high as $1.15.

• Cockatoo Coal make a new high, went up 10% yesterday and 13% this morning. How high can it fly? Refer to my previous post.

• IBA secured a contract worth $2 million with Singapore based International SOS - the world’s largest medical assistance company - for a primary care solution at its clinics throughout Asia. A good news yet a smallish one.

• REX Airline reported third quarter earning rise of 8%. Not bad at all, considering the accute pilot shortage, oil price and financial crisis. REX's share price went up as high as 9%.

Runge Limited IPO

Runge Limited IPO on 27 May 2007.
Hope things are going well tomorrow.

Runge has a lot of positive side to offer. Among them are:

• Strong client base
• Profitable company
• Not a business that a new player could enter that easily
• Commodities and mining boom.

I remember reading a book, written by my husband's great uncle, Albert Gaston, in his book "Coolgardie Gold". In this book that described the early Western Australia's Mining history, he said that the mine site's storekeepers and the Afghan drinking water seller made more money than most of the gold prospectors.

That's what Runge Ltd does: providing service to the miners.

Another Side of a Coin

The American share market had it zapped again last night, down another 200 points. This is an extension of another 200 points drop the night before. Reason? Oil Price! Crude oil rose to a record above $135 a barrel in after- hours trading on the New York ME on concern that supplies are inadequate.

The ASX? After a modest lost yesterday, actually it managed to stay on a green side today.

Australia is on the exporting side of oil and gas. Oil is Australia's fifth largest export. Not to forget other Australian alternative energy such as gas, coal and geothermal.

So, what is a record oil price mean?

Well, it depends where you are, I guess. For America, it might mean disaster, recession, inflation, and other not so nice attribute. For Australia, it means higher earning for our oil and energy company ( and of course a higher oil price that might pinch businesses and household hard). Still, it might worth it to invest in some australian energy company now. For short term at least.

Another side of a coin.

Not A Bad Oil Stock

This morning, Commsec had 2 strong buys and 4 moderate buys for BPT. Beach Petroleum, that is.

BEACH PETROLEUM ACQUIRES INTEREST IN GULF OF SUEZ CONCESSION

Beach Petroleum reports that it has entered into an agreement with Santos Egypt Pty Ltd underwhich, subject to waiver of pre-emptive rights by the Egyptian General Petroleum Corporation and the approval of the Government of the Arab Republic of Egypt, Beach will acquire, via a farmin arrangement, a 20% interest in the South East July concession, in the Gulf of Suez, offshore Egypt.

The South East July concession is currently held 100% by Santos and contains several attractiveoil prospects, one of which will be evaluated by the July South-1 exploration well in the fourthquarter of 2008.

Beach has also agreed to acquire Santos Egypt’s 25% interest in the onshore North Qarunconcession, located close to Cairo in the Gindi Basin of the Western Desert.

The agreement is subject to entry into formal documentation, waiver of pre-emptive rights by the Egyptian General Petroleum Corporation and other joint venture parties, and the approval of the Government of theArab Republic of Egypt.

The acquisition of these concessions is a result of Beach’s efforts to expand its exploration program internationally to give the company exposure to projects which have the potential to make material additions to its reserve base. This work has resulted in the identification of several opportunities in Egypt (in addition to South East July and North Qarun) which are currently under evaluation.

Cockatoo Coal

First time I saw this stock was sometimes last year, when the price was around AUD 0.24-5. It went up quickly to around forty cents, and then I stopped watching it because I thought that I've already missed the run. Looking at COK again these few days, it just proved how wrong I was. It is now sitting at around $0.95

How high can it fly?

Petterson Securities Limited, on it last report on Cockatoo, still maintain a BUY recommendation. New target price is $1.73

Report can be seen at: http://www.cockatoocoal.com.au/research.aspx

It looks quite promising, and will have a deeper look at it.

Buy in May? And...

I have had enough with bad news from the US financial. Luckily, back in Australia, things don't seem that bad anymore. I think the worst is over, and now it's time to get ready for the bull run..
Oh wait a second, is this really happening? Or is this just another dead cat bounce.. Well in this case, the poor dead cat bounce too high to pass the 6000 mark.

I'll be kicking myself if it's really just a dead cat bounce (although I got the feeling that it's not), but there's also a widely known share market axiom: Sell in May and go away..

Now, witnessing current condition of our ASX, the question is: Is this month of May, a good time to buy?

Things Might Just Get Better

Recent days in the ASX was not so bad. Things started to pick up pace, and the ASX started to disconnect itself to the US market. Slowly, but I hope it will get there.

As I wrote few days earlier, I was looking to get into more Energy shares. Energy stocks I own, BPT and DYL, have some small upward movement. It still quite disapointing for DYL, but then, it's not oil company afterall.

I rearrange my shareholding by selling AFG and half of my REX. I do not know why I have kept them for so long (too long), knowing that things are unlikely change for the better in the current situation. With the money, I bought ARQ (Arc Energy).

Today, I will try to put down some very rough research on few energy company: (Might worth a look, but as always, DYOR)

1. AED (AED OIL LIMITED)
   
   Highest Price in 12 months 11.4
   Lowest Price in 12 months 1.01
   Current Price 2.27 Trend : Sideways trending up, recently the average line crossed the price line
   Activities: Oil exploration and development


2. AWE (Australian Worldwide Exp) P/E ratio 7.95
   Highest Price in 12 months 4.17
   Lowest Price in 12 months 2.77
   Current Price 4.05 Trend : Trending Up nicely
   Activities : oil and gas exploration and production co
   On 1/05/2008 AMP Becoming a substantial holder
   On 2/05/2008 ABN Amro ceased to be a substantial holder


3. ARQ (Arc Energy) P/E ratio 11.75 Highest Price in 12 months 1.84 Lowest Price in 12 months 0.98 Current Price 1.42
   
   Trend: Trending up with a bit bumpy end, average line already crossed price line
   Broker's Recommendation: Petterson stock broker's report 6 May 2008 - Buy
   Hartley dated 7 April 2008 -Buy
   
4. HZN (Horizon Oil)
   
   Highest Price in 12 months 0.43
   Lowest Price in 12 months 0.21
   Current Price 0.33
   Trend : trending up; average under the price line
   Activities: Petroleum exploration, development and production.

Are We Through the Worst of the Credit Crunch?

Recently, reported in the Australian, Reserve Bank said that the worst in the financial crisis is over. This is a conclusion of the quarterly Statement on Monetary Policy, issued yesterday.

Some markets such as including mortgage-backed securities remain closed, but the Reserve Bank believes the crisis has left Australian banks and businesses largely unscathed.

Australian businesses are in a strong position, with high levels of profits and
continued access to debt and equity funding, despite the turmoil in financial
markets.

While it's difficult to project the future of the stock market, this report gives me a bit of relieve.
Surely it's hard for the investor to endure another another downturn, after nearly a year of turmoil.

The RBA is not the only one who's commenting about the crisis by saying that the worst is over.
Here a list of other opinions, not from a beginer like me, but from some best people in the investment and share trading business:

Warren Buffett:

"The worst of the crisis in Wall Street
is over," Buffett said on Bloomberg Television (May 3rd). "In terms of people
with individual mortgages, there's a lot of pain left to come.'' Buffett was
interviewed before the Omaha, Nebraska-based company's annual meeting.

Bank of England:

The worst of the credit crisis may now be
over and markets could soon be on the road to recovery, the Bank of England
believes (1st May, 2008).

In a report likely to reassure families struggling with soaring mortgage bills and falling house prices, the Bank's deputy governor, Sir John Gieve, said London's troubled money markets could soon recover from what is widely regarded as the worst crisis since the Great Depression.

According to the Bank of England, so pessimistic has the financial community become that it has overcompensated for the trouble ahead. Sure, the economy is in for a rough ride over the next couple of years but – compared with the current negative outlook – the prospects are positively rosy. That, at least, was the message from the Bank in its Financial Stability Report

However there are some other opinions:

• Alan Greenspan, former Fed Chairman who now consults for clients including Deutsche Bank AG, said it was too soon to declare the end to the credit crisis stemming from the collapse in the subprime mortgage market (May 5th, 2008).
• Also the comment from the JP Morgan CEO – “We can only speculate how deep and how long the recession in the United States will really be and how that in turn will impact banks…But we are not done with the crisis for a long time”. (May 3, 2008) JPMorgan Chase & Co does not expect the U.S. financial crisis to end soon and will remain very cautious.

Now the conclusion?

Finger cross!

Energy Stocks

I should probably take a picture of today's ASX action and keep it safe under the bottom of the drawer. The fact is, not everyday the All Ordinary defy Wall Street. At this moment All Ords up more than 40 points, when the Wall Street down more than 200 points. Hopefully, it's a good sign.


There are actually at least two sectors that going quite well despite of the financial crisis. They are Commodities and Energy. A quick look of my energy watch list today showed that all but two stocks are in the green. I'm currently working on the energy stock and iron stock picking. Hopefully could get few good ones to swap those underperformed in my portfolio.

OX-strata

A couple days ago, I had a hint of Oxiana's share price appreciation. But honestly, I did not expect it to be happenning now. Oxiana's share price is running for the last today. At the time I write this blog, it was up as high as $3.58, as high as 6% increase from yesterday.

Apparently, there are few reasons behind the increase, one of them is a speculation that Xstrata might want Oxiana. The Australian reported this today:

Xstrata may be eyeing Oxiana

ALL the market chatter yesterday was around Oxiana given some 40 million shares changed hands in the biggest daily turnover since the March 3 marriage to Zinifex was announced.
At the same time, there were 2500 July $3.75 option contracts that rolled over, which could explain some of the trade without having to even mention the rumour of the day, an Xstrata bid for Oxiana.
The theory is that Ken Talbot's pals at Hong Kong-based Citic will bid for MacCarthur Coal, not Xstrata, leaving the latter to break up the Zinifex marriage.
In the absence of any evidence last night, we will stick to the technical reasons for the heavier than normal volume.
But watch this space, because the same dealing desk that bought you the BG bid for Origin a day ahead of time is spruiking this one.

Thor Mining, Molly and Opes

The basic of share trading is thought to be simple, you buy at low and you sell at high.
But hold on, it can't be that simple. Try to get the connection between Thor (THR.ASX), Molly and Opes (as in Opes Prime)

Molly or MollyB or Molybdenum is a metallic that is tipped to be the next giant. They said that molly B is equivalent of supermetal…strong, tough, resistant to extreme conditions, and incredibly versatile. Fact is, it can do almost anything, from building to nuclear reactor facility.

Thor Mining is a molly and uranium prospector. The question is, if Molly is so good, why THR price went down from $0.44 to $0.10? Well, Uranium is fading, we knew that, but other factors are OPES and THE financial crisis. Unfortunately THR tangled into OPES mess.

Once things clear up, it's worth to take a look!!

Maquarie on OXR and ZFX

Let's see what Macquire has to say after upgrading the price outlook for Zinc and Copper.
Surprise.. surprise:

STOCK CALL:

Macquaire upgrades Oxiana (OXR.AU) and Zinifex (ZFX.AU) to OUTPERFORM.

"Both OXR and ZFX earnings outlooks are materially improved by our recent copper price upgrades and our current round of zinc prices upgrades, even as both share prices have muddled sideways to down," broker says.

Adds proposed merger of the miners is likely to be successful without interruption from any other potential suitors.

"The leading candidates to bid for either ZFX or OXR could be content to sit back and target an eventual merged OXR/ZFX as a more significant and easier purchase in the long run."

Target prices of A$4 for Oxiana and A$12.77 for Zinifex unchanged. (APW)

Copper Outlook

Will see what Oxiana bring tommorrow. Stocks in US drop tonight.

----
Copper soared to a record in New York, topping $4.26 a pound, as contract workers in Chile, the world's largest producer of the metal, extended a strike, hence disrupting supplies.

However, in inflation-adjusted terms, apparently the copper price hasn't yet reached a record. In real terms, the metal is trading close to levels last seen a century ago, when the U.S. economy was expanding and the nation was being wired for electricity.

Price may still going up, partly because Chile, the world's biggest copper producer, faces the risk of energy rationing after the worst drought in 50 years.

Zinc

Oxiana's share price at this moment seem to be in the losing side of the Zinifex-Oxiana deal. OXR price is tied up to ZFX's, and at this moment Zinifex's price is far from its peak.

In a long term, however, this new company will have a lot to offer, especially to their shareholders. On Bloomberg today, Macquire analysts said that zinc price may jump more than 50% in five years as as growth in mine supply slows and leads to a global shortage of the metal used to galvanize steel. This is not to mention their Gold, and Copper.

For full article:
http://www.bloomberg.com/apps/news?pid=20602013&sid=aCPNe.ePEIws&refer=commodity_futures

Iron Ore (2)

On my last post I wrote the performance of few Junior Iron Ore stocks o Friday.
It looks like they're running even harder today.


The following is from my watch list this morning:

Iron Ore

It's amazing to see the movement of Iron Ore stocks on Friday.

I own two iron ore stocks in my portfolio (MGX and SDL) and have been watching some more of them. My plan was to buy more when things are settled. It seems that I just missed a run.

The shares of the 'junior' iron ore mining and exploration stocks went running last week after the Sinosteel move on Midwest Corp succeeded and talk re-emerged of claims of rising Chinese interest in the sector and especially Fortescue Metals Group. Hopes of a final settlement between Rio and BHP and Asian steel mills with big price increases of 65% or more, is also helping improve sentiment.

Friday saw some big upward moves:

• Aurox Resources up 24.3% to 94.5c,
• Gindalbie Metals up 20% to $1.10,
• BC Iron Ltd up 17.9% to $1.45,
• Brockman Resources up 12.8% to $2.64,
• Shaw River Resources up 9% to 10.5c,
• Territory Resources up 7% to 91c,
• Atlas Iron up 6.6% to $3.37,
• Fortescue Metals up 5.4% to $8.21 and
• Mount Gibson Iron (MGX) up 5.1% to $3.07.

See, China has been busy. It succeeded to acquire Midwest, and took stakes in some of others. It looks like Chinese steel mills are focusing on the leaders in the second tier of iron companies. By that, we mean the companies outside of BHP, Rio Tinto and Fortescue who have the best-developed assets.

On the list:

• Sinosteel also took 2.4% of Murchison Metals' (MMX) shares. Murchison controls 153 million tonnes of iron at Jack Hills in WA as of today. But it wants to increase that to 375 million tonnes in the next few years
• Apollo Minerals told the market the Chinese Iron and Steel Group would increase its stake in Apollo by 19.9%. In Australia, this is the maximum stake allowed before the owner must make an official takeover bid. Apollo Minerals already had the beginnings of an off-take agreement in place with Chinese Iron and Steel Group before it took the new stake.
• Don't forget about Mount Gibson Iron saga. The Chinese tried to get 40% of them without launching a formal takeover bid.

The question is: Which one's next?

The safest asumption is, if you do not know which one, spread your buy to the lot of them.

And if I did that just a couple weeks ago, I would have made a serious money.

I did not!! The current trouble in the share market chickened me out.