Cautious trading as players wait for clarity from Trump

THE reflation play that marked most of November and December 2016 appears to have lost momentum this month, with stocks largely trading within narrow bands with a slightly downward bias. Over on Wall Street, the Dow Jones Industrial Average is estimated to have tested the 20,000 level at least 20 times in the past few weeks but has been unable to close above it, mainly as doubts surface as to whether the incoming US administration can deliver on its campaign promises.

Here, the Straits Times Index having broken through the 3,000 level last week, has drifted within narrow bands, mirroring the uncertain trading of Wall Street. On Friday, the index inched up 2.86 points to 3,011.08, cutting its loss for the week to about 14 points or 0.5 per cent.

Turnover, however, has been on the decline. After last week's S$1.1 billion average, this week's average of S$914 million was dragged lower by the year-low S$773 million done on Tuesday, while Friday's turnover was not much better at 2.4 billion units worth S$916 million.