Finally down again...

I was quite bearish starting last week, but the market just keep rallying without much reason.

What to short now? Short AIRLINES!! Reason is very obvious, oil price. More than 3 US budget airlines bankrupt this month, and one in Hong Kong yesterday.

Yesterday China Yurun (1068 HK) announced earnings. This is one of my favourite stock in HK, and it did not disapoint me. The managed to keep their gross margin at 14.1% (down from 15.4%) in a high hog price environment, which is remarkable. As many analysts pointed out, Yurun is the only company in the industry that can sustain a high margin under a high hog price because of their business model. They have slaugtering facilities in many regions and can source from more pig farmers. Having an upstream business also helps. The product mix is improving, for more details I think you should go to their website. I am very bullish on it over the long term as this industry is set to consolidate (no more small pig slaughter in the wet market!) and their chilled meat products will be in high demand as more and more supermarkets are opened in China.

http://www.yurun.com.hk/shouye.htm