STI set for firmer open despite retreat on Wall Street
The mildly positive Nikkei start and significantly higher US index futures are expected to provide some lift.
OCBC Investment Research said:
Despite the retreat on Wall Street last Friday night, the significantly higher US index futures (+0.6% on average) and the mildly positive Nikkei start (+0.4% now) are likely to cue the local bourse to a positive opening this morning.
As such, the STI which registered a 0.2% lower close in the last session could continue to find a relatively strong support at its 3-year long term uptrend line.
For now, the immediate resistance is still pegged at the 2799-2812 gap resistance formed recently, as the next obstacle lies at the 2831 minor peak.
On the downside, the immediate support is now marked at 2763 (recent trough), with the subsequent base found at the 2730 minor resistance-turned-support.
IG Markets Singapore meanwhile noted:
The talk of the town, well city, seems to be when to re-enter the market after such sharp falls this month.
While the STI has lost 7% of its value this month amid fears of a Greek exit many traders are sitting on the side lines waiting to pick up some bargains. But there are plenty still fearful of further drops with so much uncertainty still prevalent within Europe.
Have markets priced in most of the downside or is there still more to come? This question is difficult to answer given the uncertainty and unprecedented situation we find ourselves in. This almost answers the question itself pointing out that there is likely to be more stormy weather ahead.
In the meantime, it calls for defensive action with cautious investors opting for solid dividend payers and favourite blue chip stocks that have been indiscriminately sold off in the panic selling.
This week, traders are gearing up for more of the same risk-off sentiment with no obvious game-changing announcement or event expected in the days ahead.
This signals chemical firm Eastman’s commitment to its Asian clients.
Find out how the drastic changes in the industry and the “democratisation of information” have helped Saxo Bank succeed.
One of EASB’s full-time lecturer, Willard Tan, shares his incredible educational journey with EASB and how he gives back to his alma mater.
.jpg "Simon Tan")
