Activity levels up as F&N, SGX, and IHH cause buzz

The futures market is pointing to a firmer open for the STI, says IG Markets Singapore.

OCBC Investment Research said:

The mixed reactions on Wall Street overnight and the flat Nikkei start (up 0.1% now) are unlikely to provide much inspiration for the local bourse this morning.

Following a 0.4% lower opening yesterday, the STI consolidated just below the 3000 psychological level before closing with a 0.3% loss.

And with today's tone unlikely to show any significant improvements, we could see the index trading around current levels with the immediate support pegged at the 2975 minor trough.

Below that, the subsequent base is marked at the 2930 minor trough. On the upside, 3000 psychological level is still the immediate obstacle, with the next resistance pegged at the 3040 recent peak.

IG Markets Singapore meanwhile noted:

In Singapore, activity levels have gone up a notch recently with Fraser & Neave, SGX and IHH all causing a buzz in the local market. We await an approach from Kirin for Asia Pacific Breweries while Heineken has been downgraded by Standard & Poor’s as the ratings agency feels it is stretching itself with the generous offer for a stake in APB.

Singapore Airlines is also on the radar screen after reporting a 73% rise in its Q1 profits. After running a loss of $38 million loss in the previous quarter it is proving to be turbulent times for the national carrier.

Singapore Airlines faces some tough challenges from the Middle East and local budget carriers. This has intensified with news that Qantas may tie-up with Emirates and shift its Singapore hub to Dubai.

Malaysia’s AirAsia is also looking to buy Indonesia’s Batavia Air to increase its footprint across Southeast Asia.