Stocks fall with rising geopolitical risks: Weekly Review with SIAS

What happened?

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

• Thai Beverage

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

Weekly Market Review

1:55 - Macro Update

• The S&P 500 was down 2%, and the Nasdaq fell 3.6%, primarily due to tech stock declines.
• The Straits Times Index (STI) dropped 1.4% after previous strong performance.
• According to a Bloomberg report, the Biden administration warned allies of potential trade restrictions on chipmakers supplying advanced chips to China.
• Donald Trump proposed that Taiwan should cover its own defence costs.
• These developments raised concerns about rising geopolitical risks, affecting chipmaker and tech stocks.

4:20 - Singapore market updates

STI Top performers:

• Thai Beverage share price
• Singtel share price
• Yangzijiang Shipbuilding share price
• Mapletree Industrial Trust share price
• ST Engineering share price

STI Worst performers:

• Jardine Cycle & Carriage share price
• Sembcorp Industries share price
• CapitaLand Integrated Commercial Trust share price
• DBS share price 
• CapitaLand Investment Limited share price

5:04 - Thai Beverage

• Thai Beverage's stock rebounded to about $0.50 after previously falling below $0.45.
• The company plans to increase its stake in F&N to 69.61% and divest its indirect stake in Fraser's Property.
• This transaction aims to strengthen Thai Beverage's market position and diversify its revenue by increasing its exposure to non-alcoholic beverages.
• The share swap will reduce share of revenue contribution from Thailand and Vietnam while boosting contributions from Malaysia and Singapore.
• The transaction is expected to boost earnings by about 4.3%. Management also hopes that stock's valuation will improve as it increases exposure to non-alcoholic beverages and dairy.
• Announced on July 18, the transaction is expected to complete by the end of Q3 2024, pending EGM approval in mid-September.

Related links:

• Thai Beverage share price 

12:14 - Technical Analysis

STI Technical Analysis

• The STI index is testing support at the 20-day moving average around 3,420 points, with further support at the 50-day moving average near 3,367 points.
• MACD has recently crossed below the signal line, indicating a possible downtrend.
• RSI dropped from an overbought level to 58, suggesting continued potential for further declines.

Dow Jones Technical Analysis

• Key support levels are around the previous resistance of 40,089 points, the 20-day moving average at 39,684 points, and the 50-day moving average at 39,367 points.
• The MACD is converging towards the signal line, indicating reduced uptrend momentum.
• RSI has pulled back from overbought levels to around 60, suggesting potential for further retracement.

S&P 500 Technical Analysis

• The index is below the 20-day moving average of 5,540 points and may test the 50-day moving average at around 5,400 points.
• MACD shows a steep divergence from the signal line, indicating a strong downtrend.
• RSI has moved into the neutral zone at 49, suggesting weak momentum and potential further declines.

NASDAQ Composite Technical Analysis

• Key support levels are at 17,500 and 17,000 points.
• MACD has crossed below the signal line, indicating a downtrend.
• RSI has dropped below 50, signalling weak momentum and potential further declines.

What to look out for this week

• Monday, 22 July: US retail sales data
• Tuesday, 23 July: How to get to $100k by 30 seminar: Stepping Up With Portfolio Construction, Tesla, Alphabet earnings
• Wednesday, 24 July: Digital Core REIT, Mapletree Logistics Trust, OUE REIT, Frasers Centrepoint Trust earnings
• Thursday, 25 July: Singapore 1-Year T-bill auction, Suntec REIT, Mapletree Industrial Trust earnings
• Friday, 26 July: Singapore Savings Bonds (SSB) application closing date, Keppel Infrastructure Trust, Keppel DC REIT, CapitaLand Ascott Trust earnings

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

Source: SGX, Bloomberg, Refinitiv

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