Daily Markets Briefing: STI down 0.49%

Expect muted gains today.

According to OCBC, sharp falls on Wall Street last Friday is likely to spook local investors today; the Nikkei has already tumbled 2.6% in early trade.

As expected, we saw market selling into strength last Friday after the index failed to convincingly sustain itself above the initial 2850 hurdle, said OCBC.

Here’s more from OCBC:

Meanwhile, caution ahead of the US Fed meeting is also likely to keep more investors on the sidelines; and many are still unsure on which direction the markets will take should there be a rate hike.

While we peg the initial support at 2829, the real test remains at 2800; a breach of this key support would not bode well and the index could slide back to 2740 before finding firmer support.

Above 2850, we peg the next resistance at 2876, ahead of the psychological 2900 barrier.