Wednesday, September 18, 2013

Market Summary -- 18th Sep 13

FTSE STI closed 3,193.85, up 12.93 points or +0.41% with a total volume of 5.44b and a total value of S$1.41b.  Total number of advance vs decline was 282 vs 178.  Of the 30 component index stocks, 12 closed positive, 10 unchanged and 8 in the red.  The top 5 gainer component stocks were :-

1. JMH 400US$  +1.050
2. Jardine C&C  +0.270
3. OCBC  +0.150
4. JSH 500US$  +0.120
5. DBS  +0.090

The top 5 loser component stocks were :-

1. UOB  -0.030
2. Semb Corp  -0.030
3. SIA  -0.020
4. SingTel  -0.010
5. HKLand US$  -0.010
5. CityDev  -0.010

US markets rose at least 0.2% yesterday as investors await outcome of US Fed FOMC meeting.  Asian bourses were mixed but mostly higher for the day with Nikkei +1.35%, SSE +0.29% and HSI -0.27%.  STI rose to 1 month high around the 3,200 level in moderate volume and 12 of the 30 index stocks registered positive closing.

Most have expected US Fed to start scaling back its bond buying program this month with possible reduction of US$10b to US$15b from US$85b.  Should the outcome being announced tonight is what was expected, market should not be panic.  However, what if US Fed decided to delay the tapering then it will be a different story.  On the surface, it might be good as cheap and easy money still available but that is never a wise move and perhaps might even cause more panic to the market.

STI performed slightly better than regional bourses for the day but most of the activity was on the penny stocks as majority of the investors still cautious on bargain hunting on the blue chips until the outcome of the FOMC meeting.  Though different outcome might lead to different reaction to the market, the price of the stock cannot deviate from its fundamental.  A cheap valuation now based on its fundamental will make it even more cheaper and attractive should market react to the downside after the FOMC meeting outcome.  Bargain hunt is when one know of its fundamental and know what is cheap and what is not.

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