Monday, July 2, 2012

Market Summary -- 2nd Jul 12

FTSE STI closed 2,910.59, up 32.14 points or +1.12% with a total volume of 1.19b and a total value of S$1.00b.  Total number of advance vs decline was 251 vs 125.  Of the 30 component index stocks, 25 closed positive, 2 closed negative and 3 remained unchanged.  The top 5 gainer component stocks were :-

1. JMH 400US$  +1.950
2. Jardine C&C  +1.640
3. KepCorp  +0.340
4. SembMar  +0.160
5. UOB  +0.130

The 2 loser component stocks were :-

1. SingTel  -0.030
2. CapitaMall  -0.005

US markets closed at least +2% last Friday after positive outcome from EU Summit in which 120b Euro growth package was agreed by all EU leaders, short-term prevention measures for Spain and Italy also proposed in which the EU rescue funds was allowed to inject into re-capitalization of banks and buying of Government bonds.  Furthermore, agreeing to form bank union with ECB as the supervising role.  News were positive but still lack of detail at the moment for those measures.  Asian bourses taking the cue mostly opened in the positive but closed mixed with Nikkei giving up most gain and closed -0.04% despite the Tanka survey showing positive data.  SSE closed +0.03% after over the weekend releasing of official PMI data for June came in 50.2 above expectation but lowered than previous month of 50.4.  HSI was closed for holiday.  STI continued the advance later in the afternoon taking cue from positive opening from European bourses and closed +1.12% in another thin volume day and total value just slightly above the S$1b level.  25 of the 30 index stocks managed to register positive closing.

EU Summit over with positive outcome and that should bring some relief and improved the sentiment from investors and they next will shift their focus to earning season which will be starting in 2 weeks time.  Meanwhile this Friday US employment situation will be closely watch after some slipping in the past 2 months.  Will not be surprised stock prices chase up prior to outcome of earning and 2Q12 better than 2Q11 as 2Q11 was hit with the Japan tsunami in which global supply chain took a hit.  Hence, be careful of determine whether 2Q12 earning will be good or not.  Suggest comparing on quarter to quarter basis to determine resilient of the earning.  For investors who are looking to play the earning season be careful of chasing the price and get caught.  Must read the market and not let the market read you.  Have proper exit plan as in taking profit and cutting loss.

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