asx 200 index deletion, page-16

Hi Eyeswideopen and Umshebi,

There may well be a few things going on which are certainly not congruent with normal market behaviour.

To give three examples (even though I may be comparing apples to oranges): Since the 20 February 2014 ASX announcement by Strike Energy (STX) re: PEL 96, Cooper Basin, which mentions that the gas reserves may well be 4.5Tcf to Strike and 2.2 Tcf to EWC, STX share price has risen over 40% while EWC has decreased by 4%. Another case in point is the company Liquified Natural (LNG) which, since announcing a likely scenario for building an 8mtpa LNG plant in the USA (operational in 2017, the same year that PEL 96 gas is going to be commercialized), LNG share price has increased over 40%. Thirdly, the very same day that EWC announced that it will be deleted from the ASX 200 index, STX announced that it will be deleted from the All Ordinaries: EWC dropped 7% while STX share price increased by over 7%.

Since late November, 2013 the daily short selling volume of traded EWC shares has averaged around 30%, ranging from 5% to 72%. When one closely monitors the daily shorting, the following pattern emerges: as soon as EWC share gets some strength, shorting pushes the price down.

All of this against the background of EWC’s recently release Half Yearly Report as well as the mandating of the Philippines Development Bank re: US$550 million loan.

Go figure!!!