STI might be building up for a crash

STI had gone up a fair bit this week while US had stopped its quantitative easing program. Investors are waiting for news of interest rates hike.

If interest rates go up in US and Singapore, banks may have their profits affected as general loans may go down. It is because people find it more expensive to take loans.

While the hike may not be steep, it may take a longer time for the effect to kick in. Meanwhile, enjoy the smooth ride for STI. It may not be a good time to pick up stocks now, i believe there are still stocks that offer discounts.

STI index stocks like DBS, OCBC, UOB have gone up while Jardine C&C is still holding them back a little.

Oil stocks like Sembcorp Marine and Keppel Corp have gone down due to low oil prices.

Generally, now is a time to hold cash while the STI index soar. While the higher interest rate hikes kick in, it will be the time to enter the market to buy.