Daily Markets Briefing: STI down 0.4%

Index likely to open flat, says analyst.

IG Markets Singapore said:

In Asia, STI closed down 0.44% on Friday after 1Q GDP surprised everyone coming in at a negative -1.4% vs expectation of +1.7%. However, MAS continued to maintain its policy and lowering its forecast for core inflation from 203% to 1.5-2.5%.

China data out later this morning with GDP expected at 8%, we expect to see movements especially in currencies after the announcement. With the focus on China this morning, we expect the STI to open flat.

Meanwhile, OCBC Investment Research noted:

The muted reactions on Wall Street last Friday night are unlikely to provide any strong cues to the local bourse this morning.

Meanwhile, the STI’s trading range has been narrowing over the past two weeks. Until the emergence of any catalyst, the index looks likely to continue to consolidate further.

For now, the immediate key resistance is still pegged at the 3,330 key peak, while the subsequent resistance lies at the 3,400 psychological hurdle.

On the downside, the immediate base remains at the 3,280 resistance-turned-support, with the subsequent base marked at the 3,250 minor trough.