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Singapore Stocks: Resistance Expected At 3,000 Points

The Singapore stock market has finished higher now in back-to-back sessions, climbing almost 50 points or 1.6 percent along the way. The Straits Times Index wound up just shy of the 2,995-point plateau, and now traders are expected to take profit when the market kicks off trade on Thursday.

The global forecast for the Asian markets suggests mild consolidation, with investors likely to lock in gains after stocks rallied earlier in the week - particularly among the gold and technology stocks. Remarks by U.S. Federal Reserve Chairman Ben Bernanke add to the cautious sentiment as the Fed chief refrained from discussing further quantitative easing while testifying before the House Financial Services Committee. The European and U.S. markets finished with mild losses, and the Asian markets are expected to follow suit.

The STI finished modestly higher on Wednesday following gains from the financial shares and industrial issues.

For the day, the index jumped 24.33 points or 0.82 percent to finish at 2,994.06 after trading between 2,978.55 and 2,999.16 on volume of 1.81 billion shares. There were 205 gainers and 197 decliners.

Among the gainers, Keppel Corp added 0.55 percent and United Overseas Bank collected 0.28 percent.

The lead from Wall Street is negative as stocks showed a lack of direction for much of Wednesday before falling in late day trading and closing firmly in the red. The pullback by the markets was partly due to profit taking, with traders cashing in on recent strength amid ongoing questions about whether the global economic outlook supports the latest upward move.

Selling pressure was also generated by Bernanke's testimony before the House Financial Services Committee, as the Fed chief refrained from discussing further quantitative easing despite acknowledging that the pace of the U.S. economic expansion has been uneven and modest by historical standards. Bernanke also warned of lingering weakness in the labor market.

Traders largely shrugged off the release of a report from the Commerce Department showing that the U.S. economy expanded at an annual rate of 3.0 percent in the fourth quarter, reflecting an upward revision from the 2.8 percent growth that was initially estimated. The upward revision surprised economists, who had expected GDP growth to be unrevised.

A separate report from the Institute for Supply Management - Chicago showed that business activity in the Chicago-area expanded faster than expected in February. The ISM Chicago said its Chicago business barometer jumped to 64.0 in February from 60.2 in January, with a reading above 50 indicating an expansion. Economists had been expecting a reading of 61.0.

The major averages all ended the day in negative territory, with the Dow pulling back below the 13,000 level. The Dow fell 53.05 points or 0.4 percent to finish at 12,952.07, while the NASDAQ slid 19.87 points or 0.7 percent to 2,966.89 and the S&P 500 dropped 6.50 points or 0.5 percent to 1,365.68.

by RTT Staff Writer

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