May 2019 Wrap-Up - CGS-CIMB Research 2019-06-03: Singapore In 5 Mins

Singapore Strategy - CGS-CIMB Research | SGinvestors.io COMFORTDELGRO CORPORATION LTD (SGX:C52)

May 2019 Wrap-Up - Singapore In 5 Mins




Downward revision on GDP forecasts

  • The FSSTI ended May at 3,111.92pts, down 8.3% m-o-m, as US-China trade talks broke down once again. (see Performance of The Straits Times Index (STI) and Constituents in May 2019)
  • Meanwhile, Singapore's final 1Q19 GDP growth figure has been revised downwards to 1.2% y-o-y (flash 1.3%), or 3.8% q-o-q seasonally-adjusted annualised rate (SAAR). Correspondingly, the Ministry of Trade and Industry (MTI) downgraded its 2019 GDP growth forecast from 1.5-3.5% to 1.25-2.5%. Our economist sees further downside to our current 2019 GDP forecast of 2.3%.
  • Singapore's non-oil domestic exports (NODX) shrunk in 1Q19, with electronics exports down 17.2% y-o-y, and non-electronics exports down 2.6% y-o-y; a recovery in domestic demand (+2.5% y-o-y vs. 0% 4Q18) mitigated the fall in exports (+0.5% y-o-y vs. +5.6% 4Q18).


When elephants fight…



Key corporate news in May



Technical perspective – bearish

  • Following its strong bearish rejection off the 3,400 psychological resistance area and 61.8% Fibonacci retracement level, the STI has effectively turned back towards a long-term downtrend which started in Apr 2018. See Figure1 in attached PDF report.
  • Notice how the STI has been on a 4-week losing streak; this highlights its growing bearish momentum. Moreover, the bears have also broken below multiple key support areas such as the 3,200 level and 200-week moving average.
  • In the near term, the STI might consolidate around the 3,100 level. However, as the bearish momentum appears to be overwhelming, and given the lack of any bullish price action, we expect an eventual break below the 3,100 support level as the bears target the next critical psychological support at 2,955-3,000.





LIM Siew Khee CGS-CIMB Research | https://research.itradecimb.com/ 2019-06-03
SGX Stock Analyst Report ADD MAINTAIN ADD 2.820 SAME 2.820



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