STI closes with 0.5% loss

In local trading, spotlight is likely to be on DBS and F&N.

OCBC Investment Research said:

The continued retreat on Wall Street overnight and the poor Nikkei start (down 1.3% now) are likely to spook the local bourse to another negative opening this morning.

As a recap, the STI slipped lower yesterday, opening down 0.1% and drifted down to a 0.5% loss by the close.

With today's tone likely to remain pessimistic, we could see the index sliding further south in the direction of the 2980 support (minor troughs).

Below that, the subsequent base is pegged at the 2930 minor trough. On the upside, the immediate resistance is now marked at the 3060 support-turned-resistance, followed by the subsequent obstacle at the 3100 key support-turned-resistance.

IG Markets Singapore meanwhile noted:

In Singapore today local traders may be buoyed by news that our biggest bank DBS continues to power ahead. It posted a 10% rise in Q2 profits, beating analysts’ expectations.

DBS is also pushing ahead with its takeover of Danamon despite the goalposts being shifted many times by the Indonesian central bank with regards to foreign ownership.

After yesterday’s fall of 0.5% hopes of the STI bouncing back look weak with the futures market pointing to a soft open this morning. Japanese equities opened 1.4% lower.

Today is the deadline for Fraser & Neave’s offer from Heineken to buy its APB stake.