| | Close | Change | Low | High |
| STI | 1,920 | 70 | 1,880 | 1,920 |
| | Shares | Value |
| Volume Traded | 2.01 billion | $1.74 billion |
It was quite a chaotic day. But in the end, we came to realize that there was some window-dressing effect today, especially on the financial and property counters. This is because: (1) traded volume spiked up compared to yesterday, (2) the buyers were clearing the sellers' queues like nobody's business, and (3) most of our counterparties were institutions when we sold off. Coupled with a strong Hong Kong market and buoyant US
Putting this window-dressing effect aside first, we shall try to reconsider all the current issues which should affect the market. Firstly, it seems like the swine flu fears were entirely casted out of mind today. The WHO had raised the alert level from phase four to five dated yesterday. I think the people right now, are just more concern about the actual number of deaths rather than the potential severity of this issue. For now, we have eight deaths with the new one from theUS
Secondly, theUS
said last night that the recession appears to be easing. No hard figures to confirm as yet (other than some leading indicators we have seen so far), so we can assume that investors were playing on sentiment. Just that we don't know if they are serious buyers or traders.
Lastly, other than this window-dressing effect on our market, I think it is worthwhile to note that Hong Kong HSI gapped up furiously at opening today. I will expect HSI to lose strength sooner or later and retrace down to close back this gap. As a result, our market will normally be led down too.
Chart wise for STI, we have a gap at 1,860. This level is being supported by a rising 20-day MA too. Therefore, this is a strategic level for us to re-enter again. If we can confirm that this is the new uptrend, then trend traders should be prepared to trend trade once STI breaks above 1,960. Otherwise, we should only buy on pullbacks. It is still too early to tell if this is a new uptrend, or purely some window-dressing effect playing a prank on us. We will have to see what happen over the weekend.
FrasersComm and F&N:
After sending my adhoc market update, FrasersComm announced that it might consider a rights issue to refinance an existing debt of $500 million due this year. Consequently, F&N continue to perform sluggishly only to be pushed up slightly nearer the end of the day. The common understanding here is that should FrasersComm decides to go ahead with a rights issue, F&N being an important shareholder, will have to undertake its fair share of entitled rights. It might even have to help take up unsubscribed rights in the event that other investors choose not to subscribe. And my current understanding of F&N is that it is not really in a very strong position to partake the rights issue. This may be the whole reason to its sluggish performance recently.
Putting this window-dressing effect aside first, we shall try to reconsider all the current issues which should affect the market. Firstly, it seems like the swine flu fears were entirely casted out of mind today. The WHO had raised the alert level from phase four to five dated yesterday. I think the people right now, are just more concern about the actual number of deaths rather than the potential severity of this issue. For now, we have eight deaths with the new one from the
Secondly, the
said last night that the recession appears to be easing. No hard figures to confirm as yet (other than some leading indicators we have seen so far), so we can assume that investors were playing on sentiment. Just that we don't know if they are serious buyers or traders.
Lastly, other than this window-dressing effect on our market, I think it is worthwhile to note that Hong Kong HSI gapped up furiously at opening today. I will expect HSI to lose strength sooner or later and retrace down to close back this gap. As a result, our market will normally be led down too.
Chart wise for STI, we have a gap at 1,860. This level is being supported by a rising 20-day MA too. Therefore, this is a strategic level for us to re-enter again. If we can confirm that this is the new uptrend, then trend traders should be prepared to trend trade once STI breaks above 1,960. Otherwise, we should only buy on pullbacks. It is still too early to tell if this is a new uptrend, or purely some window-dressing effect playing a prank on us. We will have to see what happen over the weekend.
FrasersComm and F&N:
After sending my adhoc market update, FrasersComm announced that it might consider a rights issue to refinance an existing debt of $500 million due this year. Consequently, F&N continue to perform sluggishly only to be pushed up slightly nearer the end of the day. The common understanding here is that should FrasersComm decides to go ahead with a rights issue, F&N being an important shareholder, will have to undertake its fair share of entitled rights. It might even have to help take up unsubscribed rights in the event that other investors choose not to subscribe. And my current understanding of F&N is that it is not really in a very strong position to partake the rights issue. This may be the whole reason to its sluggish performance recently.
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