Soon, STI will see greener days
Due to the new variants of the Covid-19 virus, STI has been sluggish for the past 3 months due to the uncertainty of resuming pre-pandemic activities. Fortunately, the index is still relatively resilient and we should expect a further recovery soon when vaccination is near our ideal targets. This is in addition to the progress of vaccination in other developed nations, though we will not be able to say the same for less developed nations. That said, companies should be reporting further recovery in their business revenues especially hard-hit sectors relative to FY20 performance. In this week’s market outlook, we can see that STI retreated a little which is only normal since Singapore’s economy is heavily reliant on, tourism, trade, and travel, which were held back by the May to June restrictions.
STI – Updated Daily Chart
On the daily chart, I marked out a clear parallel channel tracking the slight downtrend of the index in recent months. If you’d notice, STI has been acting almost independently of other major indices in the world since late 2020. We should be seeing additional optimism in the market as heads towards 12 July when restrictions are adjusted/lessened again.
STI – Updated Monthly Chart
On the monthly chart, STI is still holding steady for a further uptrend especially when we have not seen the performance of the second half of 2021.
Author’s Call as of 3rd July 2021
- STI on a short term downtrend since March 2021 and it should only temporal
- We should see a further recovery in the second half of 2021
- Hard hit sectors will benefit from the lifting of some restrictions after July 12
- STI’s progress has been modest but it also gives investors more time to adjust their portfolios so we should take advantage of that
Author’s Call as of 26th June 2021
- Vaccinations capacities are increase to 80k per day to reach a higher percentage of vaccinated residents in Singapore
- New incentives will be announced after getting vaccinated
- STI was cautious in the last week as there are consistent unlinked cases on a daily basis
- The government’s reassurance will help investors gain more confidence in the market
