Monday, August 17, 2015

Market Summary -- 17th Aug 15

FTSE STI closed 3,067.35, down 46.90 points or -1.51% with a total volume of 1.33b and a total value of S$1.06b.  Total number of advance vs decline was 110 vs 346.  Of the 30 component index stocks, 4 closed positive, 2 unchanged and 24 in the red.  The 4 gainer component stocks were :-

1. SGX  +0.050
2. SIA Engg  +0.020
3. Genting SP  +0.005
4. ThaiBev  +0.005

The top 5 loser component stocks were :-

1. UOB  -0.700
2. DBS  -0.480
3. JMH USD  -0.220
4. OCBC  -0.160
5. CityDev  -0.160

US markets closed at least +0.30% last Friday but Asian bourses were mixed for the day with Nikkei +0.49%, SSE +0.73% and HSI -0.74%.  STI fell 1.51% in typical volume and value with only 4 of the 30 index stocks posted gain.

A technical rebound coupled with news that Greece sealed the 3rd bailout deal allowed US markets to close higher last Friday.  However, for Asian markets it was a mixed story.  Japan released its 2Q GDP figure this morning coming in at -0.4% q-o-q vs expectation of -0.50%.  The slight better than expected data enabled Nikkei to close positive for the day.  Rest of the regional was mainly focus on the yuan devaluation with the PBOC officially fixed at a value against USD.  The stabilization led to China market turning positive in the afternoon but not regional markets.

STI fared the worst among regional markets falling more than 1% giving back all the gain in the past 2 days weighing down by bank stocks.  Investors are seeing the yuan devaluation to have negative impact on Singapore economy.  In addition the NODX data released this morning falling 0.8% y-o-y in July vs +4.5% in June further add on the bearish sentiment.  Given that latest weak set of 2Q data, fear arises that another contraction in q-o-q will lead to a technical recession scenario.  Given that current negative sentiment, any bargain hunting will have to narrow down to those fundamental strong companies and able to hold out short-term volatility and possible downside.

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