Joey was interviewed on 938 Live after the trading session ended on Friday, 24 March 2017.
The STI suffered a huge 40 points drop mid week due to Dow Jones tanking by more than 1%, its biggest 1 day drop since the beginning of the year. What is the reason for the huge drop and its impact on the Singapore market?
More importantly, check out Joey’s view on the Singapore market as we head into 2nd quarter 2017. What are some of the levels we should keep an eye on for the STI? What about certain sectors or stocks that Joey is keeping his eyes on?
The full transcript of the interview can be seen below too.
Joey, let’s do a quick wrap for the market for the day, do you think the market moved according to expectations or were there surprises?
Singapore market opened up 2 points today pretty inline with US market flattish performance with Dow Jones closing down 4 points. This was due to concerns about Donald Trump’s ability to implement his economic agenda.
Back at home, we saw the STI in slightly positive territory in the morning led by banks like OCBC and UOB which rebounded from their week’s low.
Oil and gas counters and also property heavy weights like Capitaland and City Development also started to strengthen in the afternoon by more than 1%, pushing up index further.
So STI was pretty positive throughout the day with occasional profit taking and finally we saw STI closing up 16 points at 3142.
Let’s talk then above the US market, we saw the biggest 1 day drop mid week since the beginning of the year. How do you think this will impact the Singapore market as we are heading into the 2nd quarter?
Well, yes indeed the US market tanked by more than 1% on Tuesday night, closing down by 238 points.
The sell down in the US market was mainly due to investors growing skepticism about how quickly things can actually get done under Trump’s leadership. There are signs of slowing momentum in Trump’s proposed fiscal policies due to congressional obstacles.
And as a result we saw the STI closing down by 40 points on Wednesday along with weakness seen in other Asian markets.
Putting things in perspective, the STI has rallied from 2900 at the beginning of the year to a recent high of 3175 last week which is about 9% gain. It has been holding really well above the 3100 level over the past 3 weeks despite uncertainty over the US rate hikes which was announced last week.
So personally, I would say that we are looking at a pretty good 1st quarter for the Singapore market. With the STI maintaining above the 3100 mark, we are still poised for a bullish year ahead and we can still see more strength as we move into the 2nd quarter.
Let’s finally talk about what sectors or stocks you’re keeping an eye on? Any positions do you think that are actionable for investors and traders?
One can consider Global Logistic for some potential upside.
It has recently announced its results which were largely inline with its core earnings and net operating income rising YOY by 22% and 7% respectively.
Fundamentally, we are also seeing sustained leasing momentum in China with its properties in the US and Japan also enjoying high occupancy rates and rental uplift.
Technically, we are seeing some actions above the key 2.80 level today which it has consolidated below for almost 2 months.
Global Logistic uptrend remains fairly intact now and we can expect more upside on a specific price action above 2.80 with a short term target of 3.00.