The tone however is forecast to deteriorate significantly.
OCBC Investment Research said:
The more than 2% plunge on Wall Street overnight and the poor Nikkei start (down 1% now) are likely to spook the local bourse to a negative knee-jerk reaction this morning.
As a recap, the STI rebounded to a 0.8% higher close yesterday following Barack Obama’s success in his re-election campaign.
But with today’s tone likely deteriorate significantly; we could see the index potentially failing the retest at the 3020 key support. A breach of this base could see the index pulling back quickly to the 3000 psychological support.
On the upside, we still peg the immediate obstacle at the 3065 support-turned-resistance, with the next obstacle lying at the 3100 psychological resistance.
IG Markets Singapore meanwhile noted:
In Singapore today, the economy has suffered some weakness looking at export and manufacturing data but its financial sector continues to show resilience. UOB has announced a 36% rise in profits, joining DBS which also enjoyed double-digit income growth for Q3. OCBC reveals its Q3 results tomorrow.
On F&N watch, the climax of the Thais November 8 deadline for its $8.88 a share offer has become less exciting. Rival bidder OUE has set its own deadline of November 15 to make its own offer, pre-empting any “put up or shut up” type order from Thai Bev.
This could now see Thai Bev extending its deadline for a second time to allow investors time to consider a rival offer. The Thais cannot extend beyond passed November 27 while OUE faces its own challenges on the financing front ahead of its deadline.
Today the futures market points to a soft open for the STI this morning.
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