Ukraine crisis, China's 1st bond default provide external direction

THE main external developments of the week just past were Russia's military occupation of the Crimean peninsula, which elevated tensions with Ukraine and brought the US into the frame, and a large bond default in China, the first of its kind.

Internally, there were also a few notable developments: a continued rise in commodity stocks, possibly thanks to rumours that the Noble Group could enter into a large, lucrative deal involving its agriculture business, unusual volatility in the banks, especially DBS, continued play on water-treatment stocks such as HanKore, Memtech and United Envirotech, and construction firm Lian Beng's purchase of a 5 per cent stake in dormitory builder Centurion Corp.

After an early sell-off, markets stabilised towards the end of the week, suggesting that investors believe that neither the Ukrainian crisis nor the bond default in China will have a lasting impact and that the negative fallout from both would probably be well-contained.