Thursday, October 31, 2013

Market Summary -- 31st Oct 13

FTSE STI closed 3,210.67, down 19.77 points or -0.61% with a total volume of 1.83b and a total value of S$1.30b.  Total number of advance vs decline was 212 vs 223.  Of the 30 component index stocks, 7 closed positive, 3 unchanged and 20 in the red.  The top 5 gainer component stocks were :-

1. Jardine C&C  +0.130
2. JSH 500US$  +0.050
3. GLP  +0.020
4. GoldenAgr  +0.020
5. SIA Engg  +0.020

The top 5 loser component stocks were :-

1. JMH 400US$  -0.310
2. CityDev  -0.180
3. UOB  -0.150
4. SGX  -0.100
5. OCBC  -0.100
5. DBS  -0.100

US markets fell yesterday night after ADP job data and outcome of US Fed FOMC meeting.  Asian bourses taking the cue ended the last day of this month all in the red.  Nikkei -1.20%, SSE -0.87% and HSI -0.42%.  STI fell 0.61% in thin volume and value day.  Only 7 of the 30 index stocks posted gain.

No surprise to the outcome of the US Fed FOMC meeting in which no tapering this month and while the US Fed maintained its stance that it needs economy to show sustainable growth then consider tapering, investors somehow were on different frequency as they were mostly looking for those dovish stance by the Fed which was missing yesterday.  Hence, profit taking kicked in. 

STI was in the red for the day but the lack of volume and value suggesting apart from profit taking and following sentiment, the drop was not related to any fundamental issue.  At one hand, investors wanted the continuation of easy money from the US Fed but on the other hand pro-long stimulus program by the US Fed will increase assets bubble risk.  Remember, tapering is good for the longer term as it is removing something which was not suppose to be there in the first place and restore things back to equilibrium.

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