The Singapore market is confused

I have been asking other investors about how they feel about the Singapore market and what I realized is that many feel uncertain about the economy moving forward. The recent SPH take-over saga already shows that the market is obviously mispricing stock prices since the pandemic hit. For a $2.30+ stock (based on the latest offer) to drop to $1.00 in the first place, already shows that investors in Singapore are not pricing things fairly. Otherwise, we can also make the assumption that the current offer is ridiculously high for the value of the company.

Nevertheless, I think we can all agree that many investors do not truly understand the value of the stocks in Singapore anymore. To say the least, why should investors bother about Singapore stocks when US stocks are “promising” way higher yields? To that I say that we can still look for good deals in the Singapore market while the rest of the world is distracted by ridiculous valuations and highly charged news sensations.

STI – Updated Daily Chart

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The market’s aggression to rally has slowed down since 2 weeks ago as we approach multiple resistance levels identified in both the index as well as individual stocks.

STI – Updated Weekly Chart

We should be seeing an attempt to breakout out of the dark red resistance level in the coming weeks but until that happens, it is possible for a brief retracement if there are bad news resurfacing that include, lockdowns in other parts of the world or changes to the interest rates or QE measures.

Author’s Call as of 21st November 2021

• Investors are having a hard time pricing Signapore stocks because potential yields seem to be too thin and company performance are not as remarkable as expected
• The daily chart show that the STI is still undecided on going up or retreating in the past week (great for short term trades)
• The weekly chart shows that STI is still bound between the two support and resistance levels and will attempt to test them soon
• Investors should look at their Singapore stocks (if any) and decide if those stocks have sufficient potential for a further climb based on the slow recovery around the world (Ex US, Japan and EU, because their growth are mostly due to QE measures)

Author’s Call as of 16th November 2021

• Recovery appears to be protracted after prominent companies on the STI reports Q3 performance
• The STI ended the week with a relatively solid red candle pushing the index lower than last week’s closing
• The absence of a clear recovery from the pandemic lowers investor’s confidence to buy and hold, leading to higher volatility
• Overall, recovery is to be expected but near term volatility is inevitable, investors should take on a more reflexive approach when dealing with some of their counters and allocate their capital accordingly