Wednesday, August 14, 2013

Market Summary -- 14th Aug 13

FTSE STI closed 3,248.66, up 4.54 points or +0.14% with a total volume of 2.63b and a total value of S$1.22b.  Total number of advance vs decline was 195 vs 239.  Of the 30 component index stocks, 8 closed positive, 4 unchanged and 18 in the red.  The top 5 gainer component stocks were :-

1. Jardine C&C  +0.320
2. JMH 400US$  +0.310
3. UOB  +0.210
4. DBS  +0.070
5. OCBC  +0.020

The top 5 loser component stocks were :-

1. StarHub  -0.100
2. JSH 500US$  -0.060
3. SIA  -0.050
4. Semb Corp  -0.040
5. CityDev  -0.030

US markets closed positive averaging +0.3%, swinging from positive to negative and back to positive again after report of positive July retail sales data.  Asian bourses were mixed for the day with Nikkei +1.32%, SSE -0.29% and HSI was closed due to typhoon.  STI initially drop due to profit taking but managed to crawl back to positive with a 0.14% closing.  Only 8 of the 30 index stocks managed to register positive closing.

While corporate earning coming to an end, investors will be focusing on economic data thereby looking at fundamental with of course the usual suspect of US Fed tapering being the resistive force in any upturn of markets.  In the afternoon both Germany and France reported a better than expected 2Q GDP further affirm of Euro zone could eventually coming out of recession.  Ironically, when investors putting Euro zone aside without disturbing it (worried of which nation will default etc), Euro zone slowly working it back up to good health.  Perhaps investors should also totally ignore the concern of US Fed tapering and let US economy slowly works it way back.

STI was trading in a narrow range for the day with profit taking offsetting those global positive news.  As continued from yesterday high-yield stocks especially S-Reits were under selling pressure, that not necessary means bad news as the selling down could be due to funds rotating out to higher-beta or moving out due to so-called US Fed tapering.  As the prices of S-Reits keep selling down, it will become more attractive to bargain hunt as after all, there is nothing fundamentally wrong with S-Reits.  Bargain hunter should keep close monitor of it for opportunity.  Funds seldom get their view right, sell at wrong time, buy at wrong price.   


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