Wednesday, August 21, 2013

Market Summary -- 21st Aug 13

FTSE STI closed 3,110.58, down 18.17 points or -0.58% with a total volume of 3.59b and a total value of S$1.22b.  Total number of advance vs decline was 209 vs 235.  Of the 30 component index stocks, 8 closed positive, 2 unchanged and 20 in the red.  The top 5 gainer component stocks were :-

1. JMH 400US$  +0.780
2. JSH 500US$  +0.250
3. Jardine C&C  +0.200
4. GLP  +0.060
5. HKLand US$  +0.050

The top 5 loser component stocks were :-

1. CityDev  -0.200
2. DBS  -0.190
3. OCBC  -0.170
4. ComfortDelGro  -0.060
5. ST Engg  -0.050
5. SingTel  -0.050

US markets mostly closed positive doing a rebound from past 4 days of selling.  Asian bourses however were mixed for the day with Nikkei +0.21%, SSE +0.02% and HSI -0.69%.  STI continued to drop with a -0.xx% closing in another higher volume day and only xx of the index stocks posted gain.

A technical rebound from oversold from US markets as investors will be looking at US Fed minute for July FOMC meeting tonight to decipher on when the tapering will start.  For Asian markets the funds continued to sell and flow out as most of the bourses ended in red.  Funds flowing out from Asian in which the better, firmer and sustainable economic growth for the global economy and that is a big big question mark.  Flowing back to US ? Though US economy might be improving but still need to be cautious as fundamentally it is still weak compared with Asian.  Flow to Europe ? Though Euro zone just emerged from recession last month but the debt crisis is not totally over and EU leaders still have lot of works to do.  Stay cash and waiting for interest rate hike to benefit from it ? Not necessary true.  That is something long term investors can ponder about.

STI continued the selling as funds packing up.  That might not be a bad sign as this will enable stock prices to fall to cheaper, really cheaper level for investors who strongly believed in the sound fundamental of the Asian economy.  While the funds outflow might not have time to slowly sell, long-term and value investors definitely have the time to slowly wait for the right price to accumulate.

Risk-free CPF ordinary account 2.5% yield, special account 4% yield, average bank interest rate 0.2%, inflation around 2%, average S-Reit yield 6.4%.  To hedge against inflation, bank interest rate need to hike 10 folds, possible ?  No need genius to educate you what to do to hedge against inflation.

No comments:

Post a Comment