Rising costs are dampening market sentiments
In the recent week we saw most counters almost remaining at the same price and some dipping rather quickly. This is probably due to fear of rising costs and how it will eat into profits despite the reopening of countries and partial resumption of international travel. Fortunately, these fears are somewhat irrational as prices of goods and services have also been rising at a rather alarming rate. In the end, the market will still take the side of industries with growth in revenues and profits. As for now, stay on the look out for counters that are still on track for further recovery post pandemic. As for the rest that are already ”hot”, it is time to stay away or reduce if you have not already done so.
STI – Updated Daily Chart
The 9 and 20 days moving average suggest that the market is current about to drop again soon if there are no further stimulus to support the market. In the coming week, we should be expecting some turbulence as investors deliberate between pushing the STI into a bear market or keeping it steady and continue consolidating.
STI – Updated Weekly Chart
The weekly chart is still not revealing too much due to the muted movements in the past week but we are starting to see it head below the uptrend support line.
Author’s Call as of 4th June 2022
- Investors caution as the market starts to take profit after a tremendous run in the Singapore market
- Daily chart shows that the market is still unwilling to push for a trend reversal at the moment
- Weekly chart also does not support any sign of rebound
- Investors should start looking out for counters that are primed for recovery but are also affected by the fear of rising costs.
Author’s Call as of 28th May 2022
- With inflation hitting basic food supplies around the world, we seem to be heading towards a recession
- Charts are also not providing any comfort for now because of the range bound situation on the daily chart
- Company around the world are getting less and less investible for the near term so caution on buying in on counters that are supported by sentiments
- Suggest that investors consolidate their holdings for now and continue to focus on company fundamentals and the overall prospects of their industry and size of economy
