Weekly Review with SIAS: US stock rally continues

What happened?

In this week's Weekly Market Review in partnership with Securities Investors Association Singapore (SIAS), we discuss the positive trends in the global equity market and also share more about the following:

• UOB
• OCBC

Watch the video to learn more about what we are looking out for this week.

Weekly Market Review

0:26 - Macro update

Last week was a positive week for global equity markets. US initial jobless claims came in sharply higher, suggesting the Fed's next move may be to keep interest rates unchanged.

US stocks bounced back, with the S&P 500 returning to above 5,200.

Gains were led by the Dow Jones Industrial Average, up 2.2%, while the NASDAQ rose by 1.1%. The STI, however, was flat at around 3,300.

The Fed is still expected to maintain interest rates in June, with a high probability of no rate change.

3:20 - Singapore market updates

STI Top performers:

• SIA
• Hongkong Land
• Jardine Matheson
• Frasers Centrepoint Trust
• CapitaLand Ascendas REIT

STI Worst performers:

• Keppel
• Wilmar
• DFI Retail Group
• Venture
• Seatrium

4:56 - UOB

• UOB reported a net profit of $1.49 billion, a 6% increase compared to the previous quarter
• Net interest margin stabilised at 2.02%
• Fee income grew 5% compared to the previous quarter, driven by wealth management fees
• Cost-income ratio remained low at 42%
• Credit quality remained healthy with an NPL ratio of 1.5%
• UOB maintained its guidance for 2024, expecting low single-digit loan growth and double-digit fee growth

Read our analysis of UOB’s performance here.

9:20 - OCBC

• Net profit of $1.98 billion, a growth compared to the previous year and quarter
• Net interest margin slightly down at 2.27%
• Fee income grew, driven by life and general insurance as well as trading income
• Cost-income ratio remained subdued at 37.1%
• Allowances taken in the first quarter may be worth monitoring in the coming quarters

Read our analysis of OCBC’s performance here.

14:24 - Technical Analysis

Straits Times Index 

• Despite ending almost flat last week, the STI index has risen 3.5% over the past two weeks, driven by good results from the three banks that have reported.
• Support levels: 20-day moving average, 50-day moving average, and the Bollinger Band basis (3254 points)
• Resistance levels: Year-to-date high (3325 points), upper bound of the Bollinger Band (3359 points)
• Indicators: MACD is negative but converging with the signal line, RSI is at 58, indicating healthy momentum

Dow Jones Index

• Year-to-date high (39,889 points), support levels at 20-day and 50-day moving averages (38,363 and 38,560 points)
• MACD indicator shows strong momentum, RSI at 65 indicates healthy momentum
• Likely to retest year-to-date high soon

S&P 500 Index

• Testing the upper bound of the Bollinger Band, MACD indicator positive, RSI at 62.1 indicates healthy momentum
• Likely to test year-to-date high soon, may even break out above previous high if momentum remains strong

Nasdaq Composite Index

• Did not perform as well as other two indices, muted trading sessions last week
• MACD indicator shows slowdown in momentum, RSI at 58 indicates healthy momentum
• Likely to test year-to-date high (16,538 points) but may be affected by CPI data coming out this week

What to look out for this week

• Tuesday, 14 May: Beansprout Webinar: Finding income opportunities in the Singapore stock market, Alibaba Earnings
• Wednesday, 15 May: SIA earnings, Grab earnings, US Consumer Price Index (CPI) data
• Saturday, 18 May: FSM ETFestival 

Get the full list of Singapore stocks, REITs and ETFs with upcoming dividend payments with our dividend calendar.

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