Singapore Stocks

It is in a bottoming process.

Reasons:

Low trading volume.

Those that wanted to sell have sold.

Prices are resilient to worsening macro economic data, meaning that most bad news have been priced in.

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However, analyst expectations are not bearish enough. There is a high probability that there will be a further downgrade of stocks' rating.

Stocks are expected to trade in a sideway pattern for a couple of years before economic activity picks up. Therefore expectations of a bull rally is still too early.

People who forecast that the market will rally after the second half of 2009 are most probably too optimistic as earlier forecast that there will be a rally in 2H 2008 are proven wrong. The accuracy of forecast are usually far from reality. The rally will start only when forecasters become pessimistic of any upturn.