Global markets are starting to retreat
No markets are spared from reality. As we now start to anticipate the negative impacts of inflation on company performance, the market starts to see more selling than buying interests. After a short 3 trading day week, STI dipped and closed a lot lower at around 3290. This was probably caused by the fear of rising rates. Despite rising rates being beneficial to financial counters which are the main constituents of the STI, the decline was probably inspired by rising global uncertainties. So whats next in the month of May, many companies are paying out dividends hence there might be more interest in defensive counters before dividends are paid out.
STI – Updated Daily Chart
STI went straight down on friday and closed near to the 100 days moving average at 3290 level. If the dip continues, the next target would be roughly 3250.
STI – Updated Monthly Chart
This chart is less expressive on the monthly chart for obvious reasons. the next major support level is also at around 3250.
Author’s Call as of 7th May 2022
- Short week but the overal decline was much more severe compared to previous weeks
- Charts displays a huge dip on friday and closed with a small but solid red candlestick
- Next major support level is at around 3250
- Investors can start buying in the near term but should not over purchase as the decline might continue
- Wait for US to stabilize and see what other moves will the governments make to tame investors
- The Singapore market is still not showing obvious directions ahead despite the reopening news
- Charts are not supportive on any bullish or bearish sentiments as well
- Friday’s was not good news, perhaps inflationary fears are catching up hurting the overall sentiments in the market
- Investors should continue to calibrate their portfolios according to their comfort levels, try to find stocks which you still expect to see growth and reduce on those that have poorer prospects
