Monday, August 24, 2015

Market Summary -- 24th Aug 15

FTSE STI closed 2,843.39, down 127.62 points or -4.30% with a total volume of 1.85b and a total value of S$1.89b.  Total number of advance vs decline was 50 vs 523.  Of the 30 component index stocks, all closed in the red.  The top 5 loser component stocks were :-

1. JMH USD  -2.560
2. Jardine C&C  -1.310
3. JSH USD  -0.860
4. DBS  -0.640
5. UOB  -0.560

US markets plunged at least 3% last Friday and Asian bourses continued the massive sell down with Nikkei -4.61%, SSE -8.46% and HSI -5.17%.  STI in line with regional bourses sink 4.30% in moderate volume and value with all of the 30 index stocks registered loss.

Fear of China economy slow down, fear of US Fed rate hike next month and uncertain of Greece when its PM resigned and called for a snap election triggered another sell down in US markets sending them into correction phase, falling more than 10% YTD.  Asian markets with nothing over the weekend to alleviate the fear despite IMF trying to calm the market that China yuan devaluation is not a crisis and China giving a OK signal to pension funds to invest in the market continued the sell down. Crash is the word to describe the performance for regional markets with at least a 4% drop and China market suffered a plunge of more than 8%.  What investors need to do is to wait for the fear and panic to reside as possibility of a over-reaction is there now.

STI broke the 2,900 level and nearing the next support level of 2,800.  Despite all the talk about STI being a safer market compared with regional, the fact that Singapore economy can enter a technical recession next quarter got nothing to cheer about.  Even yesterday National Rally nothing was announced regarding the economy and further disappoint investors.  A technical rebound should be one the way but possibility of further downside still there unless Singapore economy manages to escape technical recession in the next quarter.

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