Value stocks are starting to shine, so is STI

Well, the heading is a little exaggerated because many of our stocks are still muted by the recent rise in infections but overall it is undeniable that Singapore’s market remains resilient thus far. As there might still be volatility ahead, we should be channeling more of our resources back into recovery themed stocks like travel and hospitality as those counter has much higher upsides the moment we get infections in check. At the same time, we will also soon see more methods to curb the virus in terms of mortality rates as the new approved drug has proven to be effective against severe symptoms. That should be able to help us stay within the 3200 to 3400 range for the time being.

STI – Updated Daily Chart

On the daily chart, STI performed well despite the market correction in the US. Rightfully so as they are still facing massive inflationary pressures and a market that is predominantly motivated by fast gains and greed. In the weeks to come, more funds (albeit not massive amounts) will still seek refuge in Singapore’s market. As to how long these monies will stay will depend on our company performance which should still be able to support defensive plays.

STI – Updated Weekly Chart

The STI broke out of the last resistance level in the weekly chart signaling that it is attempting to breakout last week. Will need a few more weeks to see if this is a false alarm or good news for investors. As mentioned earlier, industry impacted by the pandemic are still by and large muted at the moment so it is still not as rosy as one might think.

Author’s Call as of 5th February 2022

• Omicron infection rages but the market is still supported by value stocks and our banks
• Daily chart was bullish in the last 2 days of the short week but will not be deterministic
• Weekly chart also shows a breakout but will need more time to determine if it is not a false breakout
• Investors should start selling if you are already near your targets to avoid impending dips which might still be possible if other triggers emerge.

Author’s Call as of 29th January 2022

• Global volatility has increased significantly as the VIX hit above 30 for several days
• The daily chat shows that STI is also facing some uncertainty in the value stock sector
• We should be seeing more movements in the month of February as the US regains stability
• Investors should expect wilder swings ahead on the STI and should always consider selling before buying back to capitalise on its volatility