Buffett who runs Berkshire Hathaway Inc., clearly prefers financial companies which account for some 40 percent of the value of Berkshire's stock holdings
So far, stocks have made some recovery after the slide, The liqudity is coming back to the system as central banks pumping $ there and prices of stks have made some recovery while the Yen which was strong last week weakened. Fed and the rest of central banks certainly have helped the financial system bear out this subprime issue and preventing a financial disaster although we can expect the effects to be felt on the US economy. While market rallied these last couple of days on hopes of Fed cut, expect profit taking from day traders, uncertainty on next bad news but it seems market may just have enough fats from the good years to weather this rough patch.
Next week would continue to see rebalancing trades and futures expiry which would add to volatility of the indices and blue chips.
Current news as follow- French banking giant BNP Paribas said on Thursday it plans to unblock three of its investment funds, whose suspension earlier in the month sparked turmoil on global stock
- Goldman Sachs Group Inc.'s Global Equity Opportunities hedge fund rose 12 percent last week after the securities firm shored up the money-losing pool with $3 billion of cash, investors said.
- Singapore's DBS Group confirms today that it has more direct exposure to CDOs than previously declared. This came after broker CLSA said in a report that DBS may have S$2.4 billion ($1.6billion) worth of CDO holdings -- nearly double the S$1.3 billion directexposure it initially declared via a special purpose vehicle that had commercial paper backed by S$1.1 billion worthof CDOs. (that is what you get when you use keep them off the balance sheet, its hard to keep tabs)
- News flagging the banks affirming exposure to the subprime today, Bank of China price came off on back of its disclosure on its exposures.
