Wall Street Update and Outlook
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Previous close
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Chg
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% chg
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DOW
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11,094.57
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-1.51
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-0.01%
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Nasdaq
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2,435.38
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-5.85
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-0.24%
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S&P
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1,173.81
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-4.29
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-0.36%
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Source: Yahoo Finance
Stocks logged their first loss in five sessions as weakness among bank stocks imbued broader market trade and the dollar pared its loss. Data was of little consequence this session.
A lack of direction in the early going left stocks vulnerable to a broader slide that was led by bank stocks. Banks succumbed to a concerted selling effort related to concern regarding banks’ handling of foreclosures and representation of mortgage loan pools for use in mortgage backed securities.
The broader market was able to improve its position into the close to finish with a more mild loss. Still, the Volatility Index closed about 8% higher in its sharpest percentage increase since early September.
Personal opinion: After Intel strong results and the potential “buyout” of Seagate, AMD and Google announced very strong results this morning after the close of U.S. trades. Believe that there would be some buying interest in the tech sector tonight.
Schedule of Economic News for the Day (SIN time)
05.00 pm – EUR – CPI y/y
08.15 pm – USD – Fed Chairman Bernanke Speaks
08.30 pm – USD – Retail Sales m/m
09.55 pm – Prelim UoM Consumer Sentiment
10.00 pm – USD – Business Inventories m/m
US / Overseas Economic News
1. German Economic Institutes released a bi-annual group forecast that revised higher the country’s GDP forecast to reflect growth of 3.5% from 1.5% for 2010
2. Initial jobless claims for the week ended October 9 totalled 462,000, which is more than the 450,000 claims that had been expected, on average, among economists polled by Briefing.com. The latest initial claims figure made for a week-over-week increase of 13,000. Continuing claims fell 112,000 week-over-week to 4.40 million.
3. The Producer Price Index for September increased 0.4%, just as it did in August. The increase for September exceeds the 0.2% monthly increase that had been widely forecast. Excluding food and energy, producer prices increased a more tepid 0.1% for the second straight month, as expected.
4. U.S. Trade during August resulted in a deficit of $46.3 billion, which is up from the $42.6 billion deficit recorded for the prior month. It was also worse than the $44.5 billion deficit that had been generally expected among economists polled by Briefing.com
US / Overseas Corporate News
1. Google Inc.’s third-quarter earnings demonstrated that the Internet search leader is capable of surpassing investors’ short-term expectations while still investing heavily in long-range projects. Google reported a 32% jump in net income Thursday and provided the most persuasive evidence yet that its past investments are paying off, helping it diversify away from search advertising. Wall Street was encouraged, and sent Google’s shares soaring 9% to $590.01 in extended trading after the release of results
US Corporate Results Update & The Week Ahead
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Companies
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Stk Symbol
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Actual
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Consensus
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Advanced Micro
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AMD
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0.15
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0.06
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Google
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GOOG
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7.64
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6.68
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Source: Briefing.com
15 Oct before market opens General Electric / Infosys / Mattel
Asian Markets Update on Previous Close
Asian: Asian stock markets were higher Thursday with regional resources stocks stronger on the back of a surge in commodity prices.
Japan’s Nikkei Stock Average was up 1.9%, Australia’s S&P/ASX 200 was 1.6% higher, South Korea’s Kospi Composite was up 0.8% and Hong Kong’s Hang Seng Index tacked on 0.7%. China’s Shanghai Composite rose 0.2%. Dow Jones Industrial Average futures were up 27 points in screen trade.
In other markets, New Zealand’s NZX-50 was 0.9% higher, Singapore’s Straits Times Index gained 0.1%, Malaysia’s KLCI rose 0.5%, Taiwan’s Taiex tacked on 1.1%, Indonesian shares edged up 0.1% and Philippine shares gained 1.0%. India’s Sensex rose 0.1% and Thailand’s SET added 0.3%.
STI Market Update on Previous Close and Outlook
STI: Singapore shares ended weaker Thursday as a late round of profit taking ate into earlier gains as investors held mixed views about the Singapore central bank’s modest tightening of its monetary policy.
The benchmark 30-share Straits Times Index fell 0.2%, or 7.14 points, to 3,195.02. Losers outnumbered gainers 281 to 236. Volume was lighter with 2.04 billion shares changing hands against 2.48 billion shares on Wednesday.
Personal opinion: Singapore market may be weaker in line with the weak Asian Indices. Nevertheless, SGX may continue to outperform on anticipation of strong results, ADR listing and analyst upgrades. However for SGX, traders would be good to exercise caution post SGX’s results.
STI supports and resistances are:
Current: 3,195.02
Support 1: 3,145
Support 2: 3,136
Resistance 1: 3,214
Resistance 2: 3,275
SIN / Asian News
1. The Monetary Authority of Singapore tightened monetary policy in a surprise move, saying it will guide its currency higher at a “slightly” faster pace in a bid to contain inflation as capital inflows into Asia stoke price pressures in the city-state.
2. Over a quarter of all loans to Chinese local government financing vehicles are at serious risk of default, regulators concluded after a probe into what some analysts see as a liability for the economy. The estimate that two trillion yuan (US$300 billion) of local debt could turn sour is slightly higher than an earlier assessment by the Chinese banking regulator that 23 per cent, or 1.76 trillion yuan, was in trouble
3. Korean central bank’s decided to leave interest rates on hold at 2.25% for the third-straight month.
SIN Companies News
1. The Baltic Dry Index, which measures the cost of shipping commodities, gained 0.8% in London yesterday, taking its three-day advance to 2.8%. Cosco Corp. Singapore Ltd. (COS SP), a China-based shipbuilder that also operates bulk carriers, slid 1.1% to S$1.88. Mercator Lines (Singapore) Ltd. (MRLN SP), an Indian bulk carrier, declined 3.4% to 28.5 Singapore cents. STX Pan Ocean Co. (STX SP), South Korea’s biggest bulk carrier, rose 1.1% to S$14.54.
2. DBS Group Holdings Ltd. (DBS SP): Southeast Asia’s biggest bank said it has sold S$1.7 billion ($1.3 billion) of 4.7% perpetual preference shares. Proceeds from the sale will be used to exercise calls on other tier one notes due 2011, it said. DBS slipped 1.1% to S$14.60.
3. Neptune Orient Lines Ltd. (NOL SP): Southeast Asia’s biggest container carrier was raised to “outperform” from “neutral” at Credit Suisse Group AG, which increased its share-price estimate to S$2.43 from S$2.35. The stock rose 0.5% to S$2.07.
Source: Various sources, eg. Reuters & analyst reports
SIN Technical Highlights*
1. NA.
*This is to highlight stocks which are worth to look into from a technical standpoint for a small punt (i.e. with smaller gains over a shorter period of time) It involves speculation and may not meet the needs of certain clients. In addition, this strategy involves cutting loss if necessary. Thus, this mentality may not be suitable for some clients. Furthermore, entry and exit levels may change depending on market and chart conditions.
Commodities Update
The CRB Commodity Index had climbed to a new two-year high before it pulled back to close with a fractional gain.
Precious metals provided the most support as gold prices in the continuous contract set a new record high of $1383.90 per ounce overnight. The yellow metal settled with a 0.6% gain at $1378.50 per ounce. Silver prices swung to a new 30-year high of $24.95 per ounce overnight, but pulled back to settle pit trade with a 2.5% gain at $24.54 per ounce.
Oil prices surrendered an early gain to finish pit at $82.68 per barrel, down 0.4%. Prices started their downturn with the release of inventory data for the week ended October 8. The data showed a much smaller-than-expected draw of 416 barrels of crude oil.
All the best for your investment and trading!
*This news update was delayed. It was sent out to my clients in the morning.
Disclaimer
The information contained herein is the writer’s personal opinion and provided to you for information only, and is not intended to, or nor will it create/induce the creation of any binding legal relations. The information or opinions provided herein do not constitute an investment advice, an offer or solicitation to subscribe for, purchase or sell the investment product(s) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of this information. Investments are subject to investment risks including possible loss of the principal amount invested. The value of the product and the income from them may fall as well as rise. You may wish to seek advice from an independent financial adviser before making a commitment to purchase or invest in the investment product(s) mentioned herein. In the event that you choose not to do so, you should consider whether the investment product(s) mentioned herein are suitable for you. The writer will not, in any event, be liable to you for any direct/indirect or any other damages of any kind arising from or in connection with your reliance on any information in and/or materials appended herein. The information and/or materials are provided “as is” without warranty of any kind, either express or implied. In particular, no warranty regarding accuracy or fitness for a purpose is given in connection with such information and materials
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