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STI set for firmer open

The index is forecast to inch back up towards 3065 resistance.

OCBC Investment Research said:

The recovery on Wall Street overnight and the positive Nikkei start (up 0.5% now) could provide some relief for the local bourse this morning.

With the STI closing more than 0.4% lower and a tad below the 3020 key support yesterday, this suggests that sentiments are still relatively weak at the moment.

But with today’s tone likely to improve slightly, we could see the index inching back up towards 3065 resistance again.

Beyond that, the next obstacle lies at the 3100 psychological resistance. On the downside, 3000 psychological level is now the immediate support, followed by the subsequent base at the 2980 key troughs.

IG Markets Singapore meanwhile noted:

Wall Street and European markets rose last night as traders crossed their fingers a new president would soon be known and Greece would secure agreement on its austerity cuts.

Optimistic traders hope an election result could be hours away if all goes smoothly. However, as the race for the White House looks to go down to the wire we could face some delays with contested polls and recounts.

But for now the bulls won the day as they looked forward to the stranger called political uncertainty leaving town for another four years.

On Wall Street, the S&P 500 lifted 0.8% while the Dow Jones Industrial Average powered up 1% as a relief rally was sparked.

In Europe, stock markets and the single currency remained resilient despite the uncertainty still abundant in the eurozone. The FTSE 100 lifted 0.8% while the DAX gained 0.7%.

In Singapore today, the futures market hints at a firmer open for the STI. We could hear news of the presidential election outcome during the session which could lead to some last-minute action.

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