Just 3 months ago, analysts lined up to say the STI can hit 3000. Why are they so quiet now?
As of now the STI has retraced to 2309 pts. Any stock investor who went through the past 3 weeks will let out out a big cry : OUCH!!!
When is the pain gonna to END? ...
Over the years the stock market moves have become FASTER. Don't forget we also moved up very fast. The reason for this is hedge funds moving quickly to exploit any whimper of a trend in any market. The moment a market looks like it is falling, it comes crushing down. The funny thing is justifications come later and often sound logical. Then when you think the market will keep FALLING, it stops and reverse ....then a new logic kicks in.
When is the market going to stop FALLING? N..O..W. Why? Because Lucky Tan says so.
But if you're not satisfied with my explanation. Here is the more convoluted one. Bernanke raises interest rates to cool inflation in response to bad inflationary economic numbers, but this rate hike is the 17th ...(so does it matter? There were 16 other rate hikes during which the market went merrily up and up). However, economic numbers he is getting is from the past when commodity prices are high. They have since fallen and the US economy is seeing a sharp slowdown. Rising interest rates + sharp slowdown = DEATH to the STOCKMARKET? ....But wait, the US markets isn't even HIGH. It is trading at 14 times earnings and not considered expensive. You won't fall hard if you didn't climb too high.
I'm all for a reversal back up this very second. My call. You can shoot me if I'm wrong.