1. KepCorp +0.210
2. DBS +0.150
3. CityDev +0.120
4. SembCorp +0.080
5. JSH 500US$ +0.070
5. OCBC +0.070
The top 5 loser component stocks were :-
1. Jardine C&C -0.170
2. SIA -0.090
3. JMH 400US$ -0.070
4. SembMar -0.050
5. ST Engg -0.030
US markets closed mixed yesterday night after a 2.5% rally the day before. However, after market closed, mixture of good and bad news hit the headline. Firstly, EU Finance Ministers agreed on leverage the EFSF to less than 1 trillion euro and provide some technical details on that thus providing another small step to resolve the EU debt crisis. Furthermore, it also seek IMF help in leverage that fund and provide 30% bond guarantee on EU bonds. Bad news was S&P downgraded several US banks as in the case of August when it downgraded US Government rating. Asian bourses were mixed and mostly down with the concern of S&P. Nikkei closed -0.51%, SSE -3.27% and HSI -1.46%. STI technically was tracking regional bourses and in the red but with month end window dressing pushing the index back to positive and closed +0.53%. 19 of the 30 index stocks managed to register positive closing.
S&P downgraded of the US bank could be another deja vu scenario whereby the ultimate impact is still not there. Technically, that should be downgraded at the time when US Government rating was as how can a corporate rating not being affected if the country's rating was ? Corporate can go bankrupt and zerolized but country after default still exist. The downgrading was overdue and any reaction could be over-reacting scenario. Investors should focus on the EU debt when EU leaders meet next week for the Summit. The investors' response to a less than 1 trillion euro leverage of EFSF might not please investors and market might not reacting well to it but nevertheless it is another small positive step towards resolving the debt issue. Remember, there is no quick-fix or one-fix-all solution to the crisis and is a series of small positive steps to eventually fix it over a pro-long period of times. Investors need to give EU the time and patience to resolve it.
