To negate any decline, the index needs to regain at least its 200-day moving average, currently at 3,136.
The next re-weighting for MSCI Singapore is likely to be in February when Sea Inc’s weight rises to 100%. By then, MSCI may make a statement about the inclusion of Grab Holdings Inc, which had an inauspicious debut, ending its first trading session down 20.5%. But it’s early days. Till then, we should see some stability with the STI attempting to regain its 200-day moving average.
Although the Hang Seng Index lost 314 points week-on-week to end at 23,766 on Dec 3, the rate of decline slowered considerably. This suggests that the HSI could find support shortly at 23,175, despite dipping below the twice-tested 23,900 level.
The chart pattern shows that HSI in a downtrend, hence any support is likely to be temporary and lower levels are likely this month, as indicators are weak. Quarterly momentum may continue to inch lower in negative territory. ADX is rising and DIs are negatively placed, an indication of a downtrend. Since the HSI’s rebound high of 25,713 on Nov 16, the index has lost 1,947 points or 7.6%. The 50-day moving average (currently at 24,912) is likely to act at as a resistance line.
See also: Straits Times Index shows signs of decoupling from the US by outperforming
