“Singapore will not dip into reserves for Covid 19 in 2021”

This quote taken from Minister Lawrence Wong seems fairly conclusive, essentially, we can assume that there will be no circuit breaker imposed in Singapore for the rest of the year. Basically, we can still expect partial closures around the island when several clusters are spotted in the same area. On the other hand, some might ask, “to what end?” Well Singapore might have exhausted all practical moves in combating the virus. Reserves are tapped and our nation has went through a devastating hit by the circuit breaker in 2020, and on top of that, we have also rolled out free vaccination for all long term residents in Singapore. Therefore we might be moving towards the declaration of an endemic somewhere in 2021 or 2022. So how might this affect investors? Well, for those of us who are still trapped in the Covid Era of extreme volatility every time a minister appears on the screen in mid day, you might not be able to count on those anymore. Instead, we should start adapting to lesser volatility and longer terms of consolidation.

STI – Updated Daily Chart

On the daily chart, STI seems like it will continue on its short term recovery trajectory. Most evidently, even SATS went back in the BLACK in Q4 of 2020 despite comparably lower levels of travel hence it shows as businesses slowly restructure and poise themselves for the post-COVID era, investors should also expect to see better performances from hard hit companies and sectors in the months to come.

STI – Updated Weekly Chart

On the longer term, I would expect that STI will continue to climb as we head back to pre pandemic levels of around 3380. That said, the timeline before we arrive at that target is still unknown as there are still several factors which might delay or hasten its journey. Some of them are further lockdowns in other parts of the world affecting trade and probably even a potential cure created that can treat severe cases. As we continue to navigate through uncharted paths, let’s remind ourselves to remain objective and make the best out of the current market.

Author’s Call as of 29th May 2021

• STI should be bullish following Friday’s announcements to aid businesses and reassurance that there will be no CB
• If endemic is declared sooner, investors might rush back into the market and push the market higher than pre covid levels
• More companies in STI will be unlocking its value and pushing asset prices higher
• Accumulating when the price is right is key at the moment, blindly buying with a FOMO attitude will not be ideal

Author’s Call as of 22nd May 2021

• Watching the number of community cases closely for signs of recovery or further retracement
• The daily chart shows that STI is back in the parallel channel marked out at the start of this year
• Investors continue to stay cautious in the recent days and market movements have been slow
• Investors should consider carefully when buying stocks at the moment, selling might be a wiser move to take some profit