Singapore - Market Direction 01 (May 08 - Jul 08)

[rooster]

Whre are we heading? My reading is with the down trend odf Dow over the last 3 sessions and the reporting season ending, i believe the general market will drift side-ways bias down with the STI hitting 3050. If 3050 breaks, we may see 2900. Any one out there agrees with me?

[kennynah]

dear rooster,

welcome to huatopedia...enjoy

i cant speak about STI, as i don follow its movement as much as i should...

as you rightfully pointed out abt the US bourses, the major US corp earnings are coming to an end. Hence, this is no longer a market moving factor. Crude Oil seemingly is now the pressure point. But just like a frog in a boiling pan, it'll get use to the rising temperature, even if it gets cooked.

The Oil price was <$100pbl, not so long ago, then it got above $100pbl and life went on... It got to $115 to many outcries and then just Fri 9May, it hit a high of >$126pbl with no sight of relenting her upthrust

BUt where Oil is concerned, I reckon it to be like 99 dot.com surged, where it ended disastrously...so will Oil one day...But when, who really knows?

What differences between Oil surge and dot.com Nazdaq surge, are primarily :

a) the funds that went into them... Nazdaq was pumped with foreign reserves (SWFs)...oil, i doubt it.
b) Naz consisted of companies that offered a promises of pots of gold at the end of the rainbow. Oil, offers nothing beyond capital gains.

Naz took a longer time to build and burst. Oil, will take only a fraction of that time...and it has been building up for the last 4 months...

i dont believe in the decoupling of world's economy, so please visit the "US Stock Pick" Thread to see the SP500(the mother index)...bcos where this index goes, so will most other indexes...

regards

K

[winston]

From UOB-KayHian:-

Technical Analysis
Support at 3,120; brief rally towards 3,80-3,200

Last week, we showed that wave patterns on the Dow Jones Industrial Average (DJIA) and the Straits Times Index (FSSTI) were in terminal stages of the corrective trend and recommended selling into strength.

Since then, both indices have corrected. However, the pattern of the DJIA’s recent decline suggests that we could see another leg-up retest prior highs if support at 12,650-12,680 holds.

For the FSSTI, support is near 3,120. Stocks that we like include Golden Agri at $0.92, First Resources at $1.10, Semb Corp Marine at $4.00, Pine Agritech at $0.26 and Hongguo at $0.54.

[HengHeng]

Basically STI got no backbone one. Just look at hangseng for direction. Lunch time look at nikkei , evening look at FTSE and night look at dow jones.

[millionairemind]

STI is basically spineless and useless..If HSI is closed for the day.. no HK based hedge funds come and play... the total daily volume turnover is paltry.

Opening follows DOW close/Nikkei opening.. by 10 swayed alot of HSI.. closing follows FTSE... General uptrend or down trend follows US closely..

No point drawing all the wriggly lines on the support/resistances for STI.. Just follow the US indices

Cheers,
MM

[winston]

From DMG:-

Straits Times Index: A potential H&S Top

While our previous forecast that the correction is over for the Straits Times Index (FSSTI Index) may not have gone the correct way, the support range of 3,130 – 3,150 that we have identified for the past weeks has once again held up nicely.

What is worrying, however, is that price action looks to be charting out a Head and Shoulders Top which represents a bearish formation. Developments in the next 2 weeks would be crucial. Should price action advance but fail to conquer the 1st resistance mark at 3,270, this could suggest that the ensuing pullback would break below the 1st support area and fall all the way to the 2nd support area at the 3,030 level.

However, if the 1st resistance level is taken out, this would negate the idea that a H&S pattern is in the making and therefore propel the STI to the 3,300 level as we have previously mentioned. For this scenario, we envision that price action would enter into a stage of consolidation around the 3,300 mark before breaking above

[winston]

From CIMB:-

Immediate outlook: The Straits Times Index (STI) tested the 3,265 resistance last week but failed to breach it. Sellers saw weakness in the rally and took the opportunity to sell. By end of the week, the index closed off the weekly lows at 3,162.03. Despite the selling, the index is still sitting above its resistance-turned-support level at 3,155.

Right now, indicators show weakness but for this week, if the index is able to hold above the 3,155 level, a rebound back up to retest the 3,265 resistance is still likely. However, if the support fails, then the 100-day SMA (currently at 3,107) would need to hold for the current bull run to continue. Trade cautiously.

Medium-term outlook (2-6 months): Now that the index is trading above its 100-day SMA, we can deduce that the index is bullish for the medium term. The STI has broken out above its medium term trend line resistance recently and this is usually the first signal that the market has indeed bottomed out and is now getting ready to rally again. However, there was a bearish engulfing candle on its weekly chart, suggesting there could be some weakness in the near term. Its MACD and RSI have also flattened out, suggesting that the underlying buying momentum is easing. We still expect it to climb towards the support turned resistance of 3,320-3,350 after this short term weakness. Any weakness towards support levels may be seen as opportunity to buy. 2,800-2,820 is a strong support for the STI.

[mojo_]

The spineless STI seems to just follow overseas markets' directions, ignoring local economic fundamentals? Granted a number of STI-index listed counters do biz globally and would be affected by global economies but some are pure domestic plays...

Business Times - 15 May 2008
Diversified S'pore economy to do well: economist
By QUAH CHIN CHIN

THE Singapore economy has held up well despite slower exports in the past 18 months, an economist said yesterday.

HSBC senior economist Robert Prior-Wandesforde said that tech exports in particular have been contracting, but this has not drastically affected the economy.

'What we've seen over the past 18 months is something unprecedented,' he said. 'At the same time that the electronics sector has been under pressure, Singapore's gross domestic product growth has held up remarkably well.
.
.
This indicates that the economy has decoupled from the electronics sector and diversified into other areas, 'many of which are not correlated with the US or the developed world's economic cycle', Mr Prior Wandesforde said.

These include marine and offshore engineering and pharmaceuticals, which have doubled and grown 85 per cent respectively in the past four years.

Speaking yesterday at International Enterprise Singapore's open house, Mr Prior-Wandesforde said that 'older industries' such as financial services and construction have been reborn.

'In the financial industry, for example, we've seen a heavy push into wealth management, which is structurally a huge growth area, going forward,' he said.

'So clearly, structurally, Singapore has changed massively. It has diversified away from some of the traditional sources of growth.'

He believes that the economy 'will do pretty well' regardless of any 'global storm', and predicts 6 per cent GDP growth this year.

[kennynah]

mojo :

frustrating isnt it ?

[mojo_]

Opportunity