Wednesday, December 4, 2013

Market Summary -- 4th Dec 13

FTSE STI closed 3,160.70, down 26.97 points or -0.85% with a total volume of 1.94b and a total value of S$1.03b.  Total number of advance vs decline was 130 vs 267.  Of the 30 component index stocks, 2 closed positive, 2 unchanged and 26 in the red.  The 2 gainer component stocks were :-

1. SIA Engg  +0.030
2. SIA  +0.010

The top 5 loser component stocks were :-

1. JMH 400US$  -0.900
2. Jardine C&C  -0.870
3. JSH 500US$  -0.400
4. UOB  -0.210
5. Kep Corp  -0.170

US markets fell again with average 0.3% drop.  Asian bourses were mostly down for the day with Nikkei -2.17%, SSE +1.31% and HSI -0.76%.  STI dropped 0.85% in thin volume and value with only 2 of the index stocks registered gain.

The excuse for US markets drop was again the fear of US Fed tapering happening this month but the actual fact is the rally in US markets past weeks with all the indices hitting record high was pure speculative and bubbles in nature.  That type of rally could not be sustained by the underlying fundamental.  The US Fed tapering fear again spread through Asian bourses causing the sell off.  The only bright spot was SSE closing positive after the release of HSBC PMI for China services sector came in 52.2 in November a little unchanged from October reading of 52.6.

Singapore released its November PMI coming in at 50.8 down from October reading of 51.2 but still in expansion mode.  The general negative sentiment and the not so bright PMI data caused the sell button in STI to trigger.  The selling could be contributed by short-sellers who trying to turn the negative sentiment to drive down the stock prices to generate profit for themselves as past weeks thin volume suggested little participation in the market.  As like before, S-Reits suffered the heavier selling with the talk of US Fed tapering.  Without these negative sentiment for others to create panic, short-sellers jumping in to drive the stock prices down, where to find bargain opportunity ?  Opportunity is there when most could not see it.

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