Technical rebound? Not a convincing 2.1 % rally for STI today!

On 10/May, Singapore shares finally end higher Monday breaking a five-day losing streak after the European leaders has promised EUR 750 billion bailout plan for their Europe debt crisis.

STI ended 59.37 points (2.1%) higher at 2880.48 with average VOL of 1.76 billion shares traded compared with 2.14 billion Friday. In the broader market, gainer outnumbered losers 474 to 82. Although STI gains 2.1% today but the volume of shares traded does not perform a convinced rally.

"Investors could expect some bounce in equity prices over the next two days as the EU announces their rescue measures but fears will not be completely quashed. Investors will continue to question the effectiveness of any rescue plans and (their) future consequences," SIAS Research head Roger Tan said.

Headline in STI

Before the market opens, SembCorp Industries Ltd. (U96.SG) Monday reported that their first quarter net profit raised 19% at S$158.8 million up from S$133.6 million a year earlier. The results beat the expectation of the analysts who estimated the average of S$140 million net profit. 

During the market afternoon break, CapitaLand Ltd. (C31.SG) announced that they have won a contract to build an S$1.25 billion Raffles City integrated development project in Shenzhen, China.  This building will consist of an office tower, shopping mall, hotel and serviced residence component and will be completed in phases from 2014. 

Important Resistance of Capitaland: $3.74

Immediate Support of Capitaland: $3.50

RSI: In bearish zone of 25% (Oversold)

MY sentiment on Capitaland: This counter finally broke out of its “falling channel” after having bullish white candles in 2 consecutive days. However the last candlesticks which symbolizes a “Doji” (Indecision) may not imply well especially the volume has fallen today compared to Friday (Buying pressure reduce?).

Important Resistance of STI: 2900 (Psychological resistance)

Immediate Support of STI: 2850

MY sentiment on STI: Do not like the low volume for today’s trading session despite a gain of 2.1%. This signals that investors are not really swayed by the bail out plan and rather stay at sideline.