Morning Dew - 26 September 2013

Key Points

• JCI stayed under pressure during the mid-week, taking the index to pierce the support at 4444 and closing in towards the lower trading band at around 4300. Foreigners continued to stay on the sell side while agriculture sector was the sole survivor of today's plunge. Regionals were mixed with the Hang Seng index ended relatively flat while Nikkei fell. Unless a major positive catalyst shows up, we risk the index to drift even lower until the Fed itself removes the uncertainties it had cast upon recently.
• Economic data on Wednesday offered little significance as Fed talks have been put under the microscope. Durable goods ticked up 0.1% in August, while last month's orders fell 8.1% from June. Excluding transportation, durables also slipped lower. Other data showed that new home sales climbed 7.9% month-on-month in August, reversing earlier slump. Thursday data will feature pending home sales and the US GDP. Jobless claims is seen rising from 309k to 325k.
• Risk of government shutdown in the US has put up a burden onto the market. According to the Treasury Secretary Jacob J Lewis the measures being used to avoid breaking into the Fed will be exhausted no later than October 17th. This is not the first time we see such budget fight at Washington. This time around nothing will change, that the deal will be eventually struck, and everything will be just fine.
• ACES got its entry price filled this Wednesday and ended flat. Other recos were in the red as the JCI drifted lower. There is no change in view nor setup for now.

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