Friday, June 14, 2013

Market Summary -- 14th Jun 13

FTSE STI closed 3,161.43, up 30.74 points or +0.98% with a total volume of 2.12b and a total value of S$1.21b.  Total number of advance vs decline was 323 vs 109.  Of the 30 component index stocks, 24 closed positive, 1 unchanged and 5 in the red.  The top 5 gainer component stocks were :-

1. UOB  +0.310
2. CityDev  +0.200
3. ST Engg  +0.170
4. Kep Corp  +0.140
5. SGX  +0.140

The top 5 loser component stocks were :-

1. JMH 400US$  -1.230
2. JSH 500US$  -0.590
3. Jardine C&C  -0.140
4. DBS  -0.040
5. SIA Engg  -0.010

US markets rose average 1.3% yesterday after better retail sales and weekly jobless claims data.  Asian bourses also rebounded from yesterday sell down with Nikkei +1.94%, SSE +0.65% and HSI +0.39%.  STI rose 0.98% in a very thin volume and value day.  24 of the 30 index stocks posted positive closing.

Global markets rebounded from past days of selling down.  Whether it is oversold rebound, dead cat bounce or bottom already hit still too early to conclude.  One thing for sure, the selling was overly done in reaction to the US Fed possible of tapering.  US Fed will have its FOMC meeting next week and investors will be monitoring that for cue of when the tapering starts.  Anything that can calm the markets will see short covering and bargain hunting coming in.

For STI bottom might have been hit yesterday but going forwards investors should monitoring for stability and strength of the rebound.  Stability in the sense that volatility is no longer there and strength of rebound will have to see at each down day how the prices being supported.  Majority of the people especially TA will  at this stage takes any rebound as dead cat bounce and attempt to short at every rebound.  They are no doubt providing the most reliable indicator of the strength of the market.  At any attempt to short the market and prices do not sink further, they will be force to cover back and indirectly pushes the prices higher.  Those waiting at the sideline on seeing the continuous moving up of the prices will in an attempt to chase it.  As such a chain reaction will happen to push the prices higher up.

As a whole 2 things to monitor for next week, FOMC meeting (US Fed will calm the markets) and strength of the markets in which short sellers will be your best friend for it.  Do not rule out option that market has bottomed this week.

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