Where is the Bottom?

It looks like the market may not be over with the fall and I may not have missed the boat (refer to post here) Is there still a chance for the market to fall to a new low?

(Image source: https://en.wikipedia.org/wiki/Stock_market)

There seems to be an indication from Fed chief that interest rates may be raised within this year, which may cause the market to go lower if it does follow through on that as an increase in Fed's interest rates would lead to an increase in the long-term interest rates (necessary to make the longer-term bonds more attractive), which would lead to a higher return needed on other investments and hence a decrease in their value and prices.

Data on China showing the weakest factory activity in more than 6 years doesn't provide a very good outlook as well. Singapore's factory output also doesn't seem all too good either, with our factory output down 7% year on year last month, with only the chemical output increasing. But then again, looking at the STI, it is largely made up of services (telecomm and financial services in particular) instead of manufacturing so we may not be very adversely affected by this development.

I'm not too sure on the future of the financial services sector (not particularly enthusiastic about it to research more), but bank shares seem to be dropping quite a fair bit with DBS going below $17 and UOB slightly below $19. I'm just thinking that this may be possibly due to the increase in the SIBOR rates which may increase mortgage default rates for the banks that are providing this negative outlook. It most likely isn't a key factor, but I think it could be one of the supporting factors.

I'm not particularly optimistic right now, still think that any piece of bad news now could really spook the market. Now, with the Fed interest rate near zero, dropping the interest rate isn't an option to help spur the market so we could really be walking on eggshells. I'm going to see if I can get another chance to jump in.

On a complete side note: You may have noticed that I'm posting less frequently. I'm getting busy during this period so this may continue on for the next few weeks, but I'll try and continue posting as far as I am able to. Thank you for your support throughout the past 3.5 months :)

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