Daily Markets Briefing: STI down 1.2%

Expect more losses today.

According to OCBC, the STI tumbled 1.2% yesterday, weighed down by the sharp 8.5% plunge in Shanghai; we also saw every four stocks fall for one that rose.

Here's more from OCBC:

And with the continued weakness on Wall Street overnight, we could see more profit-taking in the local bourse today; Nikkei has opened 0.8% lower.

As before, it looks like that the STI is on its way back towards the 3302 support; but we think that it could halt its descent before the key 3267 support.

In the upside, we expect 3375 to be the next hurdle after 3357, while 3400 will be the psychological barrier to clear.

Again, we caution against trying to bottom fish the penny plays, given the lack of fundamentals behind the recent run-up.