Market Summary 

Singapore shares picked up the pieces from the previous day’s rout sparked by the Federal Reserve’s half-hearted dovish stance and recovered some ground on Friday (Nov 4) alongside most regional peers. The Straits Times Index (STI) rose 27.60 points or 0.9 per cent to 3,130.11 as traders trawled for value after Thursday’s sell-off and ahead of key US jobs data. It has ended in positive territory four of the five days, with the STI having gained 70.92 points or 2.3 per cent over the week. On the local bourse, some 1.65 billion securities worth S$1.26 billion were traded. Gainers outpaced losers, with 347 counters up and 218 down. Gains were held up by banking trio DBS, UOB and OCBC.

Wall Street stocks finished a volatile day sharply higher Friday (Nov 4) following good jobs data that was seen as keeping the pressure on the Federal Reserve to hike interest rates more. Friday’s gains ended a four-day losing streaks for stocks, reducing the week’s losses surrounding the Fed’s latest big interest rate hike. The Dow Jones Industrial Average finished 1.3 per cent higher at 32,403.22. The broad-based S&P 500 gained 1.4 per cent to 3,770.55, while the tech-rich Nasdaq Composite Index advanced 1.3 per cent to 10,475.25. Among individual companies, Starbucks shot up nearly nine per cent after reporting better-than-expected profits despite a hit from a drop in China sales. DoorDash was another big winner, rising more than eight per cent following a jump in revenues that showed consumer remain unperturbed by inflation.

Week 45 equity strategy: We are close to a "peak Fed and peak US dollar" investment theme. We still expect another 125bps of hikes until Mar23. (Dec22 +50bps, Jan23 +50bps and Mar23 +25bps). Hard to rally in a Fed pause because US equities must then grapple against the downward momentum in economic growth. This is economic weakness the Fed has warned and orchestrating for the US economy. We think positioning into REITs on a peak Fed and more defensive sectors in early 2023 is appropriate.