Why IT Services Stocks Are Falling in Singapore
Currently, the IT services stocks are falling in Singapore. The reasons for this are mainly related to the slowdown in the demand of IT services and the job cuts.
As a result, the Singapore stock market has closed lower in the last five straight sessions.
This blog will discuss the reasons behind falling of IT service stocks in Singapore
Electronic and semiconductor-related stocks are also falling
Several technology-related stocks in Singapore are at 52-week lows. Electronic and semiconductor-related stocks are also falling as investors grapple with an accelerating decline in demand.
The semiconductor industry is expected to see a cyclical correction, with prices likely to drop and sales slowing during this period.
Despite the downward pressure, semiconductor stocks can provide a long-term investment opportunity.
The industry has faced growing competition and a slowing of demand for microchips.
According to S&P Global Market Intelligence PMI surveys, evidence of semiconductor shortages around the world is emerging.
As a result, chip stocks can have high volatility. But they can also offer investors an opportunity to accumulate high-quality semiconductor companies that can ride the eventual recovery.
In the last quarter, revenue for the industry rose 70 percent, missing management’s forecast of $6.7 billion. However, it is still on track to report strong full-year revenue growth.
Job cuts are a sign of a slowdown in demand for IT services
Despite the recent wave of technology related layoffs, the Singapore job market is still seeing a strong demand for IT professionals.
Recruitment agencies expect to see a rise in the number of tech job openings in the next one to two years.
A recent survey from Indeed.com found that a staggering one in four Singapore workers plan to leave their current job in the next six months.
What’s more, half of the respondents said they were not sure if they would be in their job for the next six months.
In addition to the ‘Great Resign’, a survey from LinkedIn.com found that the largest percentage of jobs cuts were in the technology sector.
The biggest maker of computer hard drives, Seagate Technology Holdings, has been hit hard by a slowdown in hardware spending. In an effort to enhance long-term profitability, the company has taken some decisive actions.
The downside risk is larger than the upside potential
Whether you’re a local or a local resident, odds are you’ve heard of the big boys in the business. But, what’s the best way to go about it?
The answer to this question is not one word, ahem. The aforementioned Big Dogs are not exactly small – in fact, their Singapore headquarters is more of a revolving door of executives than it is an actual building.
This makes it all the more important to know who you are and what they are doing. A little know-how will go a long way.
After all, you don’t want to end up on the receiving end of a well-dressed and well-behaved Big Dog. One of the best ways to weed out the bad apples is to do your research yourself.
SGX Nifty futures are referred to by traders for early decision-making
SGX Nifty is a derivative product of the Nifty 50 stock index. The index is a value weighted average price of the top 50 companies listed on the National Stock Exchange.
The index is popular among foreign investors as well as Indian hedge funds. Foreign investors can invest in this product without having an Indian account.
They will also be able to trade it once the market closes for the day in India. It is a great way for them to hedge their exposure to India’s equity market.
The SGX Nifty index is traded in two sessions, during the day and during the evening.
Traders can follow weekly, monthly and historic charts to gauge how the index will perform. These charts will give a clear picture of major trading levels.
The Singapore stock market has closed lower in five straight sessions
Despite the hype surrounding the Dharmaj Crop Guard IPO, the Singapore stock market ended the day a little lower on the back of a few tech gurus. The Nifty fell 116 points to 18,696, while the Sensex dropped a mere 69 points to 65,487.
The Straits Times Index had a couple of hiccups along the way, most notably a couple of property stocks that swung the market. The CSI 300 Index also had its fair share of hiccups, finishing the day on a low note.
In the stock market sphere, the best performer was the ST Engineering Group. The company’s stock outperformed other blue-chip stocks such as Amazon and HCL Tech by a wide margin.
The Straits Times Index has had five straight sessions where it has fallen below the benchmark 3,235 point plateau, mainly due to a series of IT services stocks. The stock has also had its ups and downs on the back of the US-China trade war and the ongoing interest rate debate.
Conclusion
The reasons discussed in this blog clearly reveal the reason behind falling IT services stocks in Singapore.
