Wednesday, September 11, 2013

Market Summary -- 11th Sep 13

FTSE STI closed 3,108.19, down 15.70 points or -0.50% with a total volume of 3.51b and a total value of S$1.31b.  Total number of advance vs decline was 314 vs 188.  Of the 30 component index stocks, 10 closed positive, 6 unchanged and 14 in the red.  The top 5 gainer component stocks were :-

1. UOB  +0.090
2. CityDev  +0.060
3. Genting SP  +0.050
4. Capitaland  +0.030
5. SingTel  +0.030
5. SIA  +0.030

The top 5 loser component stocks were :-

1. JMH 400US$  -2.540
2. JSH 500US$  -1.700
3. Jardine C&C  -0.840
4. DBS  -0.190
5. SGX  -0.090

US markets continued the run up yesterday with average +0.70% and Asian bourses mixed for the day after past days of moving up.  Nikkei +0.01%, SSE +0.15% and HSI -0.17%.  STI was subjected to profit taking with a drop of 0.50% and 10 of the 30 index stocks posted gain.

To the relief of investors, Syria Government accepted Russia's proposal of handing over the chemical weapons and that move was welcomed by US President and shelving the idea of air strike Syria at the moment.  With the Syria issue temporary putting aside, investors are again back to the focus of US Fed tapering in the coming FOMC meeting.  It is not the issue of whether US Fed will taper this month but rather the detail and post tapering that investors should be looking at.  Trying to guess again whether US Fed will taper or not this month is nothing but ignorant views.  After the Fed FOMC meeting, next event will be German election to be held on 22nd Sep and thereafter should be the focus of US hitting debt ceiling in mid October.  Not trying to provide a solution to overcome the debt ceiling will result in US Government default.  A solution does not mean just delaying the issue to months later or raising the debt ceiling again (if the debt ceiling can be easily revised up, what is the purpose of having a ceiling in the first place and to have a higher ceiling means encouraging more borrowing and more debts for US, that is never a wise wise move).

STI under performed regional bourses for the day with a 0.50% drop.  Do not misled by the drop as it is again the group of Jardine share to make it looks bad.  The Jardine group of share can pop up to make it as if STI is having a huge rally and at the same time they can sink to make it look like a terrible drop too.  Such unreliable in STI that it is strange that mostly still tracking STI to decide on whether to buy or sell.  A wise investor or trader will never never heavily relied on STI value.  Putting STI value aside, broader market as a whole was not that bad as the minor dip due to profit taking is very much expected.

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