FTSE STI closed 3,281.95, down 46.33 points or -1.39% with a total volume of 1.36b and a total value of S$1.24b. Total number of advance vs decline was 126 vs 286. Of the 30 component index stocks, 4 closed positive, 2 unchanged and 24 in the red. The 4 gainer component stocks were :-
1. HongkongLand USD +0.110
2. SIA +0.090
3. ComfortDelGro +0.010
4. GoldenAgri +0.005
The top 5 loser component stocks were :-
1. Jardine C&C -0.920
2. JMH 400USD -0.820
3. UOB -0.640
4. KepCorp -0.370
5. JSH 500USD -0.340
US markets fell at least 1.5% yesterday and Asian bourses were mostly down for the day. Nikkei -3.02%, SSE +0.07% and HSI -0.99%. STI continued the decline with another 1.39% drop in typical volume and value with only 4 of the 30 index stocks posted gain.
2 issues sent US markets the big drop for this year so far, Greece and oil price. Asian bourses taking the cue were on selling mode for the day. Only SSE managed to reverse earlier loss and gain with slight gain thanks to the HSBC Services PMI data coming in at 53.4, a 3-month high. Rest of the markets were weighed down by the 2 issues. Greece issue at the moment is an unknown as the outcome of the coming election is unknown. It is the preparation for a possible Greece exit from Eurozone (if the result of the election is not expected) that strikes fear in the market now. For the continued plunge in oil price it was rather due to negative reports from analysts released yesterday, cutting down forecast of oil price for this year and next year. It is these reports that caused fear and panic in oil price plunge and not the fundamental of it. Should those noises are able to keep quiet, oil price will stabilize sooner than expected due to the self-correction of supply and demand. Instead of analyzing the potential damage to GDP for the continuous low price, the guessing of which level oil price will drop provide nothing constructive at all.
STI fell another more than 1% and within 3 trading days for 2015, half of 2014 gain was wiped off. Oil-related stocks led the decline but the weighing down the index were the banks and Jardine group of stocks. Short-term wise STI will be volatile by the Greece and oil price issues but on a bigger picture it is not so, remember The Lost Decade scenario !
