STI recovers with 0.5% gain

The tone is likely to improve significantly, says OCBC Investment Research, with the index forecast to reach towards the 3040 immediate resistance.

OCBC Investment Research said:

The sharp rebound on Wall Street overnight and the strong Nikkei start (up 1.2% now) are likely to boost local sentiments this morning.

The STI had already shown some positive signs yesterday; after a 0.3% higher opening, the STI recovered further to close above the 3000 psychological level with a 0.5% gain.

And with today's tone likely to improve significantly, we could see the index reaching towards the 3040 immediate resistance (key peak).

Beyond that, the subsequent obstacle lies at the 3060 support-turned-resistance. On the downside, 2975 (minor trough) is still the immediate support, followed by the next base at the 2930 minor trough.

IG Markets Singapore meanwhile noted:

In Singapore the SGX is likely to be in focus with an expected fall in profits by 16%. The exchange is suffering from low volumes during these volatile times. Magnus Bocker and the gang continue to work on ideas to boost volumes by partnering with foreign exchanges but these will take time to bed down.

The SGX needs more buy-in from retail investors who could be attracted by a bigger slice of the IPO pie. But the problem is the IPO pie has been a little on the small side this year after Manchester United and Formula 1 pulled the plug on their listings.

F&N has announced it needs another week to kick the can down the street following Heineken’s offer buying it more time to consider rival approaches should they materialise.

The STI looks set for a firm opening this morning based on the futures market and may test its year-highs once again.