Daily Markets Briefing: STI down 0.83%

Expect modest gains today.

According to OCBC, gains on Wall Street overnight should bring a much need sense of relief to the local bourse this morning, although overall tone is likely to remain cautious, given the continued uncertainty over crude oil prices.

Still, after a six-day losing streak, with the index down another 0.8% Friday, the STI does look due for a technical correction, even though the daily RSI is still some way from showing oversold signals.

Here’s more from OCBC:

Overall volume slipped 25% to 1.2b units traded; but average value/unit jumped 48% to S$0.96, mainly due to the sell-down in local banks; but we can expect to see some rebound, aided by DBS’ in-line 1Q16 results.

But until the STI can regain the uptrend line support-turned-resistance (now sitting around 2885), we could see further near-term weakness; and this could bring the key 2800 support back into play.