International Business News – U.S. stocks rebounded on July 15, driven by stronger-than-expected U.S. retail sales data in June. Singapore’s non-oil local product exports increased year-on-year for the 19th consecutive month, and market sentiment improved slightly.
Singapore’s exports of non-petroleum local products rose for the 19th month in a row year-on-year in June, the government announced, slowing to 9% from 12% in May. Among them, the export of electronic products increased by 4.1% year-on-year, compared with a year-on-year increase of 12.9% in the previous month; the export of non-electronic local products increased by 10.6% year-on-year, compared with an increase of 11.7% in the previous month. On a seasonally adjusted month-on-month basis, Singapore’s exports of non-petroleum domestic products rose 3.7% in June after rising 2.8% in May. Exports reached about S$17.7 billion.
The Singapore dollar has recently strengthened against many major currencies as a result of a series of tightening policies by the Monetary Authority of Singapore to combat inflation, according to a report from the DBS research team.With the Bank of Japan sticking to its “unlimited bond purchase” pledge and the European Union and the UK facing geopolitical tensions, inflation and growth concerns, JPY/SGD, EUR/SGD and GBP/SGD have fallen to near a 5-year low. The Monetary Authority of Singapore unexpectedly tightened monetary policy last week, helping to keep the US dollar stable against the Singapore dollar. Currency strategists at DBS Group forecast that the US dollar will remain below 1.4 against the Singapore dollar this year. On the plus side, a more stable USD/SGD exchange rate will help stem outflows and make Singapore a regional haven for capital; but on the negative side, it will make Singaporean goods and services more expensive, with overseas operations Revenue-producing Singapore-listed companies are likely to be negatively affected by foreign currency translation.
Local media quoted IG market strategists as saying that US retail sales in June were higher than expected, up 1% month-on-month, better than the expected 0.8%. Consumer confidence was also stronger than expected, with a reading of 51.1 in June, beating expectations for a reading of 49.9. Commodity prices continue to slow, inflation is expected to peak, and consumers no longer expect inflation to continue to rise, he said. Markets are now pricing in a 39% chance that the Fed will raise rates by 100 basis points in July, down from 54% previously. Affected by this, the US stock market closed higher on Friday, which is expected to boost the performance of Asian stock markets this week, pulling the STI up. Market focus should continue to revolve around the U.S. corporate earnings season, with investors likely to be cautious. Fan Jun, a stockbroker at Maybank Securities, said that from the technical chart, the STI has traded in a consolidation range from 3072 to 3165 for the past five weeks. Technical indicators show that the STI trend is weak, the main technical support level this week is around 3050 points, and the recent resistance level is 3150 points.