DEPENDING on how oil prices behaved this week, traders alternated between heavy doses of short-selling and short-covering this week, resulting in large swings in the Straits Times Index (STI) through the five days.

On Friday, the index rounded off a volatile week with its most sedate session in weeks, ending just 0.7 of a point lower at 2,656.87, bringing its gain for the week to 117 points or 4.6 per cent.

The banks and Singtel have been the index's main propellants and depressors: the excuse to short-sell came from concerns over their exposure to a collapsing oil sector, and the trigger for short-covering, from arguments such as "valuations are attractive" and "concerns are overstated".