Interest rate uncertainty will keep market volatile

LAST Saturday's market report said traders had been anticipating at the end of last week a "market-friendly" US jobs report - an intentionally ambiguous term that could mean either a very weak or a very strong report. The reason for not committing either way was unsureness about what exactly is driving Wall Street now and a suspicion that, more often than not, it is bad economic news that is more welcome than good.

As it turned out, good news on the jobs front was not welcome at all; the actual 295,000 non-farm jobs that were added in January compared to the 240,000 expected sent US stocks diving - because it means the Federal Reserve will probably start raising rates sooner rather than later.

This in turn will translate to pressure here early this week since the program traders got it wrong last Friday when they whacked the Straits Times Index (STI) up in anticipation of a strong US market that day.