On 3/May, Singapore shares ended lower Monday as China's act to tighten monetary policy causing sell down on banking and property stocks in Hong Kong, while Australian miners were shocked by the government's preparation for a new tax on the resources industry.
STI ended 30.39 points (1%) lower at 2944.22 points with 1.3 billion shares traded compared with 1.8 billion Friday. In the broader market, loser outnumbered gainer 431 to 94. Although today STI has slumped 1 % lower but the VOL is extremely LOW indicating that the selling pressure is still much contained.
The market may look for cues from Europe and first-quarter earnings announcements by index heavyweights such as banks, Singapore Technologies Engineering and Sembcorp Marine, analysts said.
Today SMRT had a massive sell down due to the disappointing news announced on Friday. SMRT closed 5.7% lower at $2.15 with 8.6 million shares (4 times average) traded. SMRT got downgraded by numerous banks as operating expenses are likely to rise this year due to higher energy prices.
JPMorgan cuts to Neutral from Overweight, cuts target to S$2.20 from S$2.25; DMG cuts to Sell from Buy, keeps target at S$2.00; CIMB cuts to Neutral from Outperform, cuts target to S$2.35 from S$2.41; DBS Vickers cuts to Fully Valued from Buy, cuts target to S$2.00 from S$2.08, Kim Eng cuts to Sell from Buy, cuts target to S$1.90 from S$2.47.
SMRT’s huge sell down also caused its rival ComfortDelgro with 1Q10 results due May 14 to close 2.6% lower as investor fears that the upside potential may be minimal as well.
Important Resistance of SMRT: $2.20
Immediate Support of SMRT: $2.13
RSI: In bullish zone of 53%
MY sentiment on SMRT: Do not encourage to enter now. Just wait for the VOL to ease as this counter still have downside potential.
MY sentiment on STI: LOW VOL and still supported at important technical level 2940 indicated that the market should not due for correction yet. Moreover more earnings report will be announce in this week.
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