Monday, August 11, 2014

Market Summary -- 11th Aug 14

FTSE STI closed 3,306.45, up 17.56 points or +0.53% with a total volume of 1.49b and a total value of S$814M.  Total number of advance vs decline was 290 vs 165.  Of the 30 component index stocks, 21 closed positive, 1 unchanged and 8 in the red.  The top 5 gainer component stocks were :-

1. JSH 500USD  +0.300
2. Jardine C&C  +0.290
3. DBS  +0.150
4. OCBC  +0.130
5. HongkongLand USD  +0.080

The top 5 loser component stocks were :-

1. UOB  -0.060
2. CityDev  -0.060
3. ComfortDelGro  -0.040
4. StarHub  -0.030
5. SPH  -0.020
5. JMH 400USD  -0.020

US markets rebounded last Friday with at least 1% gain.  Taking the lead, Asian bourses all rebounded from last week sell off.  Nikkei +2.38%, SSE +1.38% and HSI +1.29%.  STI rose 0.53% but with thin volume and value, 21 of the 30 index stocks registered positive closing.

The geopolitical concerns on Ukraine-Russia and Iraq have eased allowing global markets to stage a rebound from last week sell off.  However, most bourses were on thin volume suggesting most still cautious with short-covering probably playing a bigger part in the rebound.  With no further deterioration of the geopolitical issues, investors could be turning to economic data next.  Japan will be releasing its 2Q GDP this week and most will expect a contraction due to the impact of the sales ta hike.  Over the weekend, China released its CPI for July coming in at 2.3%, well below its target of 3.5% and that gave investors some belief that Chinese Government will have more rooms for loose monetary policy to stage rebound on its economy.

STI managed to recover some loss from last week sell down but the lack of volume and value suggesting most still sideline and waiting for firmer cue.  The panic selling from last week will need some times to settle down before bargain hunting can resume.  If without further negative events, STI should be entering consolidation within the region of 3,280 to 3,340.

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