STI set to open lower amidst expected volatile week for markets

IG Markets Singapore forecasts the STI to open around 0.5% lower.

OCBC Investment Research said:

Despite the modest gains on Wall Street last Friday night, local sentiments are likely to be dampened by poor Nikkei start (down 0.4% now) and the retreating US index futures (down 0.2% now).

As a recap, the STI rebounded strongly at the 2800 key psychological support to close just 0.1% lower in the previous session despite opening more than 1% in the red.

And with today's tone likely to turn downside biased, we could see the index slipping back towards the 2800 immediate base again, with the subsequent support lying at the 2760 minor trough.

On the upside, the immediate resistance is still pegged at the 2862 minor peak, as the next vital obstacle lies at the 2900 key support-turned-resistance.

IG Markets Singapore meanwhile noted:

With no major moves in the US equity markets on Friday, all the major benchmarks posted modest gains following on from the second largest daily fall in 2012 on Thursday. The standout performer was the Nasdaq, which managed to add 1.2%. Most of Friday’s gains have already been erased in the pre-market futures trading this morning.

In the currency space there is little real change to where we stood at the Singapore close on Friday. On the whole, risk currencies and the yen remain pressured by US dollar strength following on from the FOMC meeting last week.

Oil managed to stage a mini recovery on Friday with front month WTI pushing back above $80.00 at times and well off the intra-day lows, in the end settling at $79.76. Gold barely moved to stay trading in the $1570 range.

For the Singapore open this morning we are calling the STI to open around 0.5% lower.