The Straits Times Index (STI) crossed 3,100 points level for the first time in rolling one-year period yesterday. STI stood at 52-week high of 3,107.87. Interestingly, the 52-week low level happened exactly one year ago at 2,521.95.
Last year (2011) was a particularly bad year for Singapore equity. The index started at 3,190 and ended 2,646. This was a 17.0% drop in the span of one year. The year-to-date gain in the index for this year (2012) was 17.4%. This is just a catch-up to wipe out market decline in 2011. We are just about back to square one.
The next question is whether STI will rise further to make substantial gain over the two-year period before the end of this year?
Much depends on the Singapore economy for rest of the year and moving into 2013. Analysts were predicting a technical recession for the third quarter, meaning two consecutive quarters of GDP decline. On an overall basis, the year may still see a positive but low growth in GDP. As for 2013 forecast, the Ministry of Trade & Industry (MTI) may forecast growth rate higher than this year’s. Watch out for 12 October press release from MTI.
Copyright © 2012, limkimtong for Living Investment
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