Singapore market (20 Nov 12)

Singapore market: may open higher today, taking cue from the strong US markets overnight. Sales of existing US homes rose unexpectedly rose 2.1% to a 4.79m annual rate, exceeding forecasts. Gains in housing prices are likely to boost consumer finances and sentiment, as it is one of the key factors underpinning household spending that accounts for ~70% of the US economy. Positive data from the US may help offset news that Moodys has removed France from its top credit rating, after it cut France to Aa1 from Aaa. In Asia, Nikkei and KOSPI are +0.2% and +0.9% respectively, at 8.10am . Technically, yday’s bounce in the STI bodes well for a short term recovery, as the indicators begin to hook up from still oversold levels. Resistance is at 2,977, support at 2,905. Trend is still negative however, unless the 200day MA (close to 2,977) can be successfully overcome.