The more US market drops, the more I expect the market to rise in November. Yesterday US drops by 250 points, the third largest one day drop this year. This is surely not something we expect 3 weeks before the US election. I think President Obama will be concerned with the stock market going into the election.
Research have shown that the probability of the incumbent party will get re-elected only when the stock market does well in the last 2 months before election. So Obama should be sweating over this.
Having said that, we still maintain our view of bullishness in the last quarter. Just that short term, the market seems weak with the poor earnings report from some influential companies. Yesterday was Dupont, one of the industrial companies in Dow Jones 30. Actually there are some companies that show positive earnings and these are ignored by the market. One such company is Facebook.
So my view remains the same for US market, unless Apple issues a positive earnings results that is well received by the market, this lack of market confidence might still continue. Apple has the chance to turn around the market 2moro after market close.
Coming back to the Singapore market, it does seems that STI is diverging from the path of the US market, which is showing remarkable resilience! In fact, Hang Seng, KLCI and Shanghai Composite are all stubborn to follow US market. With US dropping 250 points yesterday, Singapore actually did not drop a lot, today it close 0.7points only.
It is time to watch some singapore stocks.
Once things get better with US, Singapore market should continue its upwards trend.In my last article, I have noted some Singapore companies for us to study.
If you are conservative, you might want to wait for Thursday Apple earnings to judge. The reason is if Apple fails, it might cause another small panic in US market.