The Straits Times Index (STI) ended the week of July 28 – Aug 1 at 4,153, down 108 points week-on-week. Support is at 4,000.
Technically, both quarterly momentum and 21-day RSI have turned down, without forming negative divergences with price. This suggests that the current retreat is likely to be relatively shallow.
Support has been established at 4,000. The year’s high was on July 24 at 4,274. The earlier breakout of 4,000 indicated an upside of 4,400 and this remains valid. However, as the chart pattern develops, the pattern could indicate new targets.
The stocks that may continue to lead the index lower are likely to be the banks that appear to have overshot on the upside. With results coming in, and the grey dawn of declining net interest margins and net interest income being felt, banks may take a while to consolidate.
Straits Times Index
See also: REIT Index points to upside as STI continues consolidation
Since the local risk free rate has stabilised at the 2.09%-2.11% level, Sora is also likely to stop its sharp decline.
Gold remains in demand by central banks
See also: STI to continue correction; here are the supports for Sembcorp, DBS and STE
The World Gold Council (WGC) says total 2Q2025 gold demand (inclusive of OTC investment) increased by 3% y-o-y to 1,249 tonnes. In value terms, total gold demand jumped 45% y-o-y to US$132 billion.
Investors keep nibbling at gold ETFs, which they see as a hedge against the US dollar. Global gold-backed ETFs were instrumental in boosting overall 2Q2025 demand. Uncertain global trade policy, geopolitical turbulence and the rising gold price all fuelled inflows, the WGC says.
Bar and coin investors also joined the fray, attracted by the rising price and gold’s safe-haven attributes. Two consecutive quarters generated the strongest first half for bar and coin investment since 2013.
Central banks remained a key pillar of global demand, adding 166 tonnes to global official gold reserves. Although the pace of buying moderated, the outlook for central bank demand remains healthy.
Jewellery demand volumes and value continued to diverge; y-o-y declines in tonnage were widespread, while spending on gold jewellery saw universal gains. Volumes were very muted.
Gold used in technology came under pressure from the potential impact of US tariffs, although growing demand for AI-related applications remains an area of strength.
Gold (US$/oz)
Charts: Bloomberg
