SET Index : Mixed signals going in to early March

The SET Index closed indecisively on Friday, leaving room for a move in either direction depending on global market direction and fund flows early this week. In our view a daily close (and preferably several) above 1001 is needed if the Index is to free itself of bearish overtones and risk associated with a none too certain local outlook, and the fun and games of a national election. In terms of volume confirmation a move above 1000 needs solid flows of 42-45bn for a couple of days at the very least, with a strong foreign buy-side bias

This may be too much to ask given increasing uncertainty from the Middle East, but at worst 987-989 or so should be retested. A daily close below 978 is needed if the bears are to have another go, and as noted next week the lower target is still the gap range which spans from 957 to 951

We will be watching for a breakout above 2940 on the Shanghai Composite Index  (SSEC) early this week as a good leading indicator for the ASEAN markets. Also watch NYMEX crude for a break at resistance at 100 or at support at 95, likewise for spot gold at 1417-1420 and 1400-1404.


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