Daily Markets Briefing: STI up 1.5%

Brace for sharp losses today.

According to OCBC, the reversal on Wall Street overnight could also see similar profit-taking in the local bourse today, especially after the STI’s 1.5% gain, which could not quite sustain above the key 2900 level.

Here's more from OCBC:

As before, we see yesterday’s rebound as just a technical rebound and also a means for investors to unwind stale longs – we note that many counters have ended off their intraday high as well.

Hence, if the STI fails to retake 2900, we could see the index slipping back towards 2860 or even 2800 (also expecting the Chinese markets to weigh on sentiment).

And if 2800 gives way, it could lead to a return to around 2698 (early Jun 2012 low).

On the upside, we again peg the initial key hurdle at 2900, ahead of 2950.