Daily Markets Briefing: STI up a modest 0.3%

Analyst predicts 0.3% decline.

IG Markets Singapore said:

The STI failed to get as excited as it edged up a modest 0.3% yesterday. After the pullback seen in US equities we are pricing for the STI to start the day around 0.3% lower, giving back all of yesterday’s gains.

Meanwhile, OCBC Investment Research noted:

Although we did see the STI staging an early charge yesterday, the index faltered at the centre line of the Bollinger Band at 3282; it subsequently ended just 0.3% higher.

As before, we still see a risk of the STI staging a pullback to 3171 (38.2% retracement of 2931-3319 rally); this if the initial support at 3258 (38.2% retracement of 3160-3319 rally) gives way.

Again, we peg the initial hurdle at 3282 ahead of the key 3300 psychological barrier.

Penny stocks continue to remain in play, with the average value traded still hovering around S$0.20/unit - an indication of “froth” in the market.