Singapore Market September 2020 Wrap Up - CGS-CIMB Research 2020-09-30: Singapore In 5

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Singapore Market September 2020 Wrap Up - Singapore In 5




Positive data surprises. Restrictions ease.

  • The FSSTI closed Sep at 2,466.62 pts, down 65.89 pts (-2.6%) from Aug, as countries grapple with a second wave of COVID-19 outbreaks, and the Nov 20 US elections adding further uncertainty. As of 23 Sep, the Singapore government has further loosened restrictions on work, gatherings and essential travel due to the low number of COVID-19 cases in the community.
  • Singapore’s NODX expanded by 7.7% y-o-y in Aug 20 (Jul: +5.9% y-o-y), above our estimate of +3.4% y-o-y, underpinned by electronics, non-monetary gold, specialised machinery and food preparation sectors.
  • Ex-Biomed, IPI for Aug 20 rose 15.3% y-o-y (Jul: -4.3% y-o-y), with a spike in manufacturing (+44.2%% y-o-y), due to a pick-up in global activity and stockpiling ahead of US’s ban on suppliers to Huawei (from 15 Sep), while Petrochem (+7.8% y-o-y) and Pharma (+5.7% y-o-y) also clocked gains.
  • According to Urban Redevelopment Authority data, primary home sales in Aug 20 rose by 11.8% y-o-y and 16.3% m-o-m, with half coming from Rest of Central Region (RCR) projects and another 40% from suburban projects.


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Technical perspective

  • The FSSTI declined 2.6% in Sep, reinforcing the Head and Shoulders pattern that was validated in Jul. Recall that the bearish break below the uptrend line or neckline in Jul (See Fig1 in PDF report attached below) provided the signal that the FSSTI could see further downside to the 2,310 support area. Since then, the FSSTI has showed a growing bearish momentum as the 20-day moving average capped the upside on multiple occasions.
  • More notably, with the recent bearish breakout below the 2,480-2,500 critical support area in Sep, the next leg of sell-offs appears ready to take over to target the 2,310 support area. In case of any near-term rebound, the 20- and 60-day moving average at the 2,500 to 2,540 area would likely limit the upside.





LIM Siew Khee CGS-CIMB Research | Jeremy NG Choon Heng CGS-CIMB Research | https://www.cgs-cimb.com 2020-09-30
SGX Stock Analyst Report ADD MAINTAIN ADD 1.700 SAME 1.700
ADD MAINTAIN ADD 3.400 SAME 3.400
ADD MAINTAIN ADD 0.854 SAME 0.854



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