Another good week for the US markets as it notches fourth straight positive week climbing on a wall of fear. US market continues to ride on the AI theme although there are signs of slowing momentum as stocks have ran up quite a bit already.
The greed & fear index has entered the extreme greed zone which indicates the sentiments are much better now and traders are willing to go risk on. We are a little contrarian when it comes to this, being extreme greed might not be too good for the short term as traders start to pile in to the market. We have been giving advanced cue since may for a potential upswing which has happened and now market seems a little high and we prefer a pullback before entering. Not chasing the markets for now.
For this week , CPI and Fed meeting will be the key events to look out for. Market participants are expecting fed to keep rates and not increase it. 30% are seeing a raise. So if Fed does raise the rates, we might see a pullback from the markets.
STI
Chartsource: DZH Advisor 11th June 2023
STI still a little lackluster, with a few stocks standing out from the rest. Sembcorp industries and SIA are two that are shinning brightly.
For this week, we might see some rebound from Keppel Corp, Capitaland Invest and SATS. STI could move up to test 3200 then 3225. STI could also wait and see if Fed pauses rate this coming week which might actually not be too good for the banks as it would mean that interest rate hike has peaked and banks moving forward might not see such high net interest margins already.
HSI
Chartsource: DZH Advisor 11th June 2023
HSI is a lot more exciting and active than the other regional markets as we are seeing a strong rebound ever since HSI went into a bear market. This rebound has caught the shortist hence seeing a fiercer rebound. Many are speculating a stimulus from China’s government to spur the markets. Do be careful as it could be a sell on news kind of situation as markets are rebounding on such expectations.
For this week, we might continue to see rebound to 19600 then 20k Strong resistance around the 20k mark where HSI should take a break. We hope you took the chance to load up on some good shares like Alibaba, Baidu and Tencent. Another exciting week ahead.
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Yours
Humbly
Kelwin & Roy
