Skip to main content

Week Ahead: Close Watch on Markets' Reaction to Moody's U.S. credit Downgrade

 


Week Ahead: 12 May 2025

Post markets fell after Moody's downgraded U.S. credit rating to Aa1. Many has anticipated this downgrade but will be watchful during early week trading. 

Medium Term: 
S&P 500 (SPX): The S&P 500 Index has broken above the 5,350–5,550 range. The index may test the 5,780 support level, or if momentum persists, retest the 6,147 level.

Consider long positions above 5,780 with upside target at 6,147. Use tight stops below 5,750 to manage risk.

Hang Seng Index (HSI): Our China Market Long-Term Cycle Indicator continues to signal an upward trend for HK/China markets. The Hang Seng Index (HSI) is expected to trade sideways, with the possibility of testing support around the 22,750 level.

Alternatively, the index's uptrend could extend toward the 24,200 resistance level.

Range-bound trading favoured between 22,750–24,200. Enter longs near 22,750 support with stops below 22,400. Consider breakout trades if index clears 24,200.

Straits Times Index (STI): The Straits Times Index (STI) outlook remains. Our base case anticipates a retest of the 4,000 zone. Alternatively, the index may consolidate within the 3,800–3,900 range.

Focus on break above 3,900 to initiate longs targeting 4,000. Use the 3,800–3,900 range for short-term range trading setups.

Long Term:
S&P 500 (SPX) Neutral Trend
Hang Seng Index (HSI) Upward Trend
Straits Times Index (STI) Uptrend Trend

Headlines Next Week:
US Corp Earnings: Home Depot, Palo Alto
SG Corp Earnings: Singtel, SATS
US: G7 FinMin summit, Fed speakers, housing data, initial jobless claims, S&P mfg & services PMI.
China: LPR decision, Apr IP, retail sales, property data, surveyed jobless rate.
Singapore: Final 1Q GDP, Apr CPI

Disclaimers apply


Most Popular

Historical Stock Market Performance During the Year of the Snake (2025)

Historical Stock Market Performance During the Year of the Snake (2025) Introduction: The Chinese zodiac plays a fascinating role in shaping cultural beliefs and behaviors. Among the 12 zodiac animals, the Year of the Snake is often associated with intelligence, caution, and financial shrewdness. We take a simply review of three key indices, S&P 500, Hang Seng Index (HSI), and Straits Times Index (STI),  annual performance  during the Year of the Snake. Key Observations from the Data: S&P 500 Performance: Average annual return: 0.47% . Win/Loss ratio: 37.5% (3 years of gains vs. 5 years of losses). Notable years: 1989 marked a robust gain of 27.25% , while 1941 saw a steep decline of -20.22% , coinciding with global tensions during World War II. HSI Performance: Average annual return: -5.36% . Win/Loss ratio: 66.67% (2 years of gains vs. 1 year of losses). Notable years: The index's strongest year was 1989, with a return of 5.55% , while 2001 suffered a severe decli...
Read more

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...
Read more

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...
Read more