Friday, January 24, 2014

Market Summary -- 24th Jan 14

FTSE STI closed 3,075.99, down 24.25 points or -0.78% with a total volume of 2.24b and a total value of S$1.11b.  Total number of advance vs decline was 141 vs 256.  Of the 30 component index stocks, 4 closed positive, 1 unchanged and 25 in the red.  The 4 gainer component stocks were :-

1. JMH 400US$  +0.450
2. SingTel  +0.020
3. StarHub  +0.010
4. THBEV  +0.005

The top 5 loser component stocks were :-

1. Jardine C&C  -1.680
2. JSH 500US$  -0.770
3. Kep Corp  -0.200
4. DBS  -0.170
5. HKLand US$  -0.130

US markets fell at least 0.5% yesterday after rise in weekly jobless claims, weak corporate earning and China flash PMI data.  Asian bourses were mostly in the red for the day taking the cue from US.  Nikkei -1.94%, SSE +0.60% and HSI -1.25%.  STI fell another 0.78% with thinner volume and value.  Only 4 of the 30 index stocks posted gain.

Worries of China economy might slow further down after the flash PMI data showed contraction as the Chinese Government trying to balance between reform and growth.  US corporate earning starting to miss expectation one by one kept investors wondering is US economy really on solid foothold to recover given that US Fed has already started tapering this month.  The picture now is totally different from one month ago when investors were also optimistic even after US Fed announced tapering.  Nothing has changed in fact, just that investors tend to be overly optimistic then and now it is reality time.  Is it time to bargain US on weakness ? Asia has proven to be the growth engine in past years and it will continue to be, so bargain hunt in US or Asia you decide ?

STI started in the red but fall further in the afternoon on weakness of regional bourses and European markets.  With CNY next week and negative sentiment from regional bourses short-term traders and punters were off to close positions while bargain hunters probably wait till after CNY then enter the market.  Short-term weakness in STI but not the fundamental of it.

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