STI likely to open softer this week

AS noted in our Saturday column, trading in the local market last week was largely within expectations, the Straits Times Index (STI) dropping into the red for the year to date when the US Federal Reserve started its two-day Federal Open Market Committee meeting, then bouncing up smartly when the inevitable dovish statement was released.

We say "inevitable" because throughout the past eight years as the Fed sought to plug the holes in a badly leaking US economy, it has bent over backwards to accommodate Wall Street, so an explicitly hawkish statement was not likely by any stretch, even if markets traded as if it was.

As has usually been the case for many months now, rises and falls in the STI were before the same on Wall Street and not after, so Friday's jump here was duly followed by a rise in the US market - once again, within expectations.