Weekly Market Outlook

Thoughts on the Week Ahead:
Week of July 15, 2024

Following the release of the CPI data, the market now prices a 90.30% chance of a 25 basis point (bps) rate cut at the US FOMC meeting on Sept 18th. We have also observed a market rotation towards disinflationary trades.

Here are some interest rate-sensitive asset classes, sectors, and markets that moved higher after the CPI report:
• Bonds (e.g., TLT, ZROZ)
• US Growth/Small Cap (e.g., IWM)
• Global REITs (e.g., SCHH, CFA)
• Utilities Sector (e.g., XLU)
• China and Hang Seng Indices (short-selling curbs also contributed to their rise)

A Note on PPI
It is important to note that Friday's US Producer Price Index (PPI) report did not decline in line with CPI. PPI is a leading indicator of US inflation.

Short-Term Tactical for the Week Ahead
Given the mixed signals, our strategy for the coming week will be cautious and selective for the US and Singapore markets. We favour the Hong Kong market.

In the Longer Term
A fall in inflation could also mean weakness in the economy. Thus, despite our continued long and bullish stance on the US economy, we are constantly monitoring for changes in market momentum or any market-altering news or events.

Headlines for the week:
- US Corp Earnings (GS, BAC, MS, J&J, NFLX, and AXP)
- US Jerome Powell Interview, Retail Sales
- China Third Plenum Meeting, 2Q24 GDP, MLF Rate
- SG Jun NODX

Disclaimers apply

Palantir Technologies Inc PLTR: Technical Rebound at Sight After US Broad Market Stabilises

Palantir Technologies Inc. (PLTR) USD86.24 Palantir (PLTR) posted a bullish reversal, closing above the 13-day SMA (83.56) with significant volume expansion. This signals potential momentum strength in the near term. First key resistance zone between the 50% and 61.8% Fibonacci retracement levels (USD 99.85 – 105.79), which could present selling pressure. Disclaimers apply

DBS Group Holdings (D05) and Straits Times Index (STI): Technical Change of Momentum

DBS Group Holdings (D05) and Straits Times Index (STI): Technical Change of Momentum Recent price developments in DBS Group Holdings (SGX: D05) and the Straits Times Index (STI) signal a critical inflection point. Both instruments have breached established ascending trendlines, suggesting a potential reassessment in investor sentiment and market trajectory. DBS Group Holdings (D05) Price Dynamics: DBS has decisively broken below its ascending trendline, closing at SGD 44.23, registering a 3.53% decline. The price action underscores weakening upward momentum and raises the probability of an extended correction phase. Key Technical Levels: 38.2% Fibonacci retracement: SGD 41.45 50% Fibonacci retracement: SGD 39.78 61.8% Fibonacci retracement: SGD 38.12 Full retracement: SGD 32.72 Outlook: The breach beneath the trendline suggests an erosion of bullish conviction. Immediate attention should be on the 38.2% retracement le...

Week Ahead: US Indices Momemtum in Question

Week Ahead: 10 March 2025 Key event this week was U.S. indices technically closed below the key 30-week (or 150-day) moving average . For the upward trend to continue, the indices need to reclaim levels above the moving averages. Remaining below the 30-week (or 150-day) moving average could indicate that the upward trend has reversed downward. However, in the short term, we expect a rebound as the indices trade near their respective support levels. Medium Term: S&P 500 (SPX): The S&P 500 broke below its key upward trendline, which had been established since October 2023. In the longer term, we expect the index to trade sideways or move in a downward direction. In the short term, we anticipate the S&P 500 will find support at the 5,700 level and could rebound to test the 5,860 and then the 5,966 resistance zones. Straits Times Index (STI): The technical trend remains bullish. We maintain a constructive outlook while staying vigilant for any sig...

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