Thursday, October 2, 2014

Market Summary -- 2nd Oct 14

FTSE STI closed 3,228.71, down 35.38 points or -1.08% with a total volume of 1.69b and a total value of S$1.00b.  Total number of advance vs decline was 138 vs 292.  Of the 30 component index stocks, 2 closed positive, 1 unchanged and 27 in the red.  The 2 gainer component stocks were :-

1. Kep Coirp  +0.010
2. SIA Engg  +0.010

The top 5 loser component stocks were :-

1. Jardine C&C  -1.820
2. JMH 400USD  -1.580
3. JSH 500USD  -0.900
4. DBS  -0.160
5. UOB  -0.150

US markets fell at least 1.30% yesterday and that caused Asian bourses all in the sea of red.  Nikkei -2.61%, SSE and HSI still closed for national holiday and STI fell 1.07% in slightly higher volume and value than yesterday.  Only 2 of the 30 index stocks registered positive closing.

Mixed bags of economic data from US with ADP jobs number higher than expected but ISM dropped below expectation and there was a first case of Ebola caused US markets to correct more than 1% overnight.  The positive ADP jobs data was seen by investors that this coming non-farm payroll should continue to show strength in labor market and that will relate to US Fed might just hike interest rate sooner than expected.  There is still no resolution for Hong Kong pro-democracy protest as it ran into the 7th day.  Many will be looking at how the Chinese Government going to resolve it, preferably without leading to violent.  Tonight investors will be looking at the detail ECB going to unveil regarding its ABS purchase as a form of stimulus to revive Euro zone economy and fight deflation.  Most tip the size of the ABS purchase will be a big one somewhere between 200b to 300b euros.

STI taking the cue from US overnight continued the drop.  Apart from the punters cutting loss and traders short-selling, there isn't much of real selling as funds already sold in last month end of quarter window dressing.  The Jardine group of shares practically dragged down the index.  On the other hand, S-Reits are gathering buying momentum at the moment ahead of their earning in 2 weeks time, not to mention the dividend being declared then.  On technical sense, the drop today brought STI closer to the support (5% pull back from recent high) which should trigger a rebound next.

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