Daily Markets Briefing: STI up 0.9%

Expect limited gains today.

According to OCBC, with Wall Street shut overnight and the European bourses posting moderate losses, the local bourse is unlikely to see futher gains; this especially after the STI’s unexpected 0.9% higher close yesterday, which came despite the slump in Singapore PMI numbers in Jun.

Here's more from OCBC:

In addition, we note that while the overall market volume jumped 43% on 1.89b units traded, total value fell 9% to S$0.97b, resulting in the average value/unit sliding 37% to S$0.51; this suggests that the focus is switching back to the penny plays and second liners.

Last but not least, the STI is also fast approaching a key psychological hurdle at 2900, where failure to convincingly clear it could ignite profit-taking across the board. On the downside, we peg the initial support at 2850, ahead of 2800.