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STI’s 2013 Turbulence
In the Spotlight | 03 January 2014
By: Peter Ng
Articles (81) Profile

As the saying goes, what goes up must come down, what goes up fast must come down faster. This held especially true for the Straits Times Index (STI) as it soared over 200 points and reached a year high at 3,450 points. Arising from fears of Quantitative Easing (QE) tapering, the STI crashed more than 300 points to a support at 3,070 points. Attempts of the index’s recovery in September was shortlived, as events like the penny stocks saga and expectations of QE tapering obstructed any sustainable recovery.

The chart and legend below summarised the key events which happened in the STI in 2013.

STI's 2013 Turbulence

Events that caused a rise in the STI
1.   US avoided fiscal cliff
3.   German investor confidence index rose to highest level since Jun 2010
6.   BOJ expanded QE programme to 1t Yen (approximately $12.1b) annually
7.   US jobless claims data came in at 5-year low
      ECB planned negative bank deposit rates
      STI on 5-year high at 3,450 points
9.   US Fed signalled QE tapering
11. US unemployment rate decreased to 7.5%
      China’s economy demonstrated signs of stabilising
13. US Government budget deficit recorded below US$1t at US$680.3b
      China’s non-manufacturing sector grew at quickest pace in 13 months
16. STI closed at 3,167 points; up 0.01% for the year 

Event that caused a fall in the STI
2.   7th property cooling measures in Singapore
4.   Budget 2013: Further property cooling measures & new car financing scheme
5.   Mini crisis in Cyprus
8.   US Fed delayed QE tapering due to lacklustre job data
      STI erased all gains made for the year
10. Syrian government chemical weapon attacks
      Expectations of QE tapering intensified
12. Shutdown of Obama administration
      Penny stocks crashed; Asiasons Capital, Blumont & LionGold Corp
14. Typhoon Haiyan crashed counters exposed to the Philippines; Del Monte Pacific, Petra foods and Super       Group
15. US Federal Reserve tapered QE to US$75b per month
Backed by a strong interest in investments, Peter's research spans across a range of industries, with his focus placed on companies listed on the SGX.

Please click here for more information about this author.


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