SGX Market Review : STI Technical Analysis & Forecast

STI MARKET REVIEW :

Singapore shares opened marginally lower on Tuesday with the benchmark STI falling 16.75 points or 0.58 per cent to 2854.72 and ended 29.53 points or 1.03% lower to 2837.14. STI came off from its intra-day peak of 2857.14 and low of 2837359.

STI Day Performance

Open: 2854.72

High: 2857.14

Low: 2837.59

Close: 2841.94

Change(Points): -29.53

% Change: -1.03%

Volume: 1322.90 M

Rise: 156

Fall; 219

Unch: 414

Singapore stocks traded lower at noon on Tuesday. Apart from a smattering of small-cap news, there was little to drive trading. Weakness in China and Hong Kong that followed an overnight slump on Wall Street as well as a drop in the Dow futures contract that indicated a soft Tuesday for the US market all added up to weigh on sentiment in STI.

LOCAL BOURSE

Singapore's retail sales rose 5.2 per cent year-on-year in July. Singapore remains the top Asean investment pick for the world's big four economies (China, India, Japan, and the US).

Singapore home sales fell in August as developers marketed fewer projects in a month considered inauspicious by Chinese homebuyers. Singapore's unemployment rate remained low and stable amid the tight labour market for the first half of 2015.

TECHNICAL INDICATORS

RSI	Below center line at 33.687
CCI	Below the signal line at -93.643
MACD	-72.610 Above its signal line at -80.888

Market forecast:

STI is expected to take side ways trend. It has broken its support level of 2860, its next support level is at 2800. If it breaks this level it is expected to go down to level of 2830, it has its resistance at 2870. Investor sentiment remains cautious over the pending FED decision to increase the interest rate and concern over the chances of decreasing domestic consumtion due to degraded air quality in Singapore.

STI LEVELS
Support 1	2805
Support 2	2755
Support 3	2698
Resistance 1	2870
Resistance 2	2935
Resistance 3	3000

STI COUNTER SPECIFIC NEWS

• DBS Group Holdings, Singapore's biggest lender, said on Monday it would slowly wind down its Islamic banking unit as it failed to achieve economies of scale.
• ARA Asset Management on Monday said it has successfully raised US$325 million in capital commitments for its private real estate funds division.
• Olam International fell 3 cents to S$1.955 with some 222.1 million shares changing hands.
• Hyflux rose by as much as 8.7% on Tuesday, on news that the integrated water management provider and its consortium partner, Mitsubishi Heavy, Industries had clinched a $750 million contract to design, build, own and operate a waste-to-energy (WTE) plant in Tuas for 25 years.

GLOBAL FACTORS AND WORLD INDICES:

• Hong Kong shares gave up early gains and ended Tuesday lower, with investor sentiment subdued by slumping mainland stocks. Hang Seng index fell 0.5 per cent, to 21,455.23.
• China's benchmark Shanghai Composite Index slumped 3.52 per cent on Wednesday, having fallen below the symbolic 3,000 level during trading as investors worried over a crackdown on illegal trading.
• British annual inflation fell back to zero in August after oil prices recorded their biggest fall since the start of the year, ensuring price growth remained far slower than the Bank of England's target.
• Bank of Japan said that slowing emerging market demand was putting further strains on the economy but held off on expanding stimulus, preserving its limited policy options in case an expected US rate hike sparks more global volatility.
• Indonesia posted a US$433 million trade surplus in August, the statistics bureau said on Tuesday, smaller than the US$630 million surplus forecast. August exports were US$12.70 billion, falling 12.28 per cent from a year earlier, while imports were US$12.27 billion, down 17.06 per cent.
• India's central bank is considering a proposal that would limit the number of participants in a single lenders' consortium, in a bid to encourage banks to carry out better independent credit checks and do more to chase rogue borrowers.
• Dollar snapped a six-day skid against the euro but dropped against the yen Monday as currency traders girded for a major US Federal Reserve decision later this week.
• Recent rise in eurozone property prices appears sustainable, but the recovery is weaker than in past cycles and the eventual normalisation of interest rates poses some risks, the European Central Bank said on Tuesday.
• China's benchmark Shanghai Composite Index slumped 3.52 per cent on Wednesday, having fallen below the symbolic 3,000 level during trading as investors worried over a crackdown on illegal trading.
• World crude prices extended their losses Monday, pressured by persistent concerns about the global supply glut as Opec lowered its demand growth forecast for next year.
• Gold bulls can't shake the specter of higher US interest rates as Federal Reserve policy makers gather this week.

COMMODITY

CRUDE OIL	$44.41
GOLD	$1104.90
SILVER	$14.285

MAJOR CURRENCY PAIRS

SGD/USD	0.7135
EUR/USD	1.1305
GBP/USD	1.5423