ELEVEN STRAITS TIMES INDEX (STI) STOCKS TRADING BELOW 200-DAY MOVING AVERAGES

Dear readers, as of March 21, 2025, there are eleven Straits Times Index (STI) stocks that are trading below their 200-day moving averages (200 DMA). This development warrants closer examination, particularly for investors and traders who actively follow market trends and stock performance.

When a stock trades below its 200-day moving average, it typically indicates that the stock is in a longer-term downtrend. The 200-day moving average is a widely utilized technical indicator that smooths out price data over the last 200 days. This smoothing effect provides investors with a clearer picture of the stock’s overall trend, making it easier to assess whether a stock is in an upward or downward trajectory.

Implications of Trading Below the 200 DMA

1. Bearish Sentiment: Stocks that remain below their 200 DMA often reflect a bearish sentiment among investors. This suggests that there are concerns regarding the stock’s future performance. Investors may be wary of potential risks or negative news that could further impact the stock price.
2. Trend Confirmation: A stock consistently trading below its 200 DMA may confirm a prevailing downtrend, which can make it less appealing to traders who typically seek out stocks in an upward trend. This confirmation can lead to a self-reinforcing cycle, where negative sentiment drives more selling, pushing the price down further.
3. Resistance Level: The 200 DMA can serve as a significant resistance level. If the stock price attempts to rise back above this line but fails to maintain that level, it may indicate continued underlying weakness. This dynamic often causes traders to be cautious, as repeated failures to break above the 200 DMA can signify persistent selling pressure.
4. Market Psychology: Many traders and investors use the 200 DMA as a benchmark for long-term performance. When stocks are consistently trading below this average, it can lead to a lack of confidence in the stock’s prospects, resulting in increased selling pressure. This psychological aspect of trading is crucial, as market sentiment often drives price movements.
5. Potential Buy Signals: On the flip side, some traders actively look for stocks trading below their 200 DMA as potential buying opportunities. They may perceive these stocks as undervalued or believe that a reversal is imminent, particularly if there are signs of positive developments. However, this strategy carries inherent risks, as the downward trend may continue, leading to further losses.
6. Volatility and Risk: Stocks trading below their 200 DMA can be more volatile and may carry higher risk. This reality makes them less suitable for conservative investors, who may prefer more stable, upward-trending stocks. The increased volatility often results in wider price swings, which can be both an opportunity and a challenge for active traders.

With these insights in mind, let us take a closer look at the eleven STI stocks currently trading below their 200-day moving averages as of March 21, 2025:

1. CapitaLand Investment: A major player in the real estate sector, CapitaLand Investment has faced challenges in the current market environment, with its stock price dipping below the 200 DMA.
2. CapitaLand Ascendas REIT: This real estate investment trust (REIT) focuses on business and industrial properties but has also struggled to maintain upward momentum.
3. City Developments Limited: A prominent property developer, City Developments has experienced fluctuations that have led to its stock trading below the critical 200 DMA.
4. Frasers Logistics and Commercial Trust: This REIT, which invests in logistics and commercial properties, is similarly facing headwinds that have affected its stock performance.
5. Genting Singapore: The gaming and hospitality giant has been impacted by various factors, including economic conditions that have resulted in its stock trading below its long-term average.
6. Jardine Cycle & Carriage: A key player in the automotive and financial services sectors, Jardine has seen its stock performance dip below the 200 DMA.
7. Mapletree Industrial Trust: Focused on industrial properties, this REIT has encountered challenges that have affected its stock performance.
8. Mapletree Pan Asia Commercial Trust: Another REIT that invests in commercial properties across the Asia-Pacific region, it has also seen a decline in its stock price relative to the 200 DMA.
9. SATS Ltd.: A leading provider of gateway services and food solutions, SATS has faced challenges that have kept its stock below the 200 DMA.
10. Venture Corporation: Known for its technology and manufacturing services, Venture has struggled to maintain upward momentum in its stock price.
11. Yangzijiang Shipbuilding: This prominent shipbuilder has been affected by market conditions that have led to its stock trading below the 200-day moving average.

In conclusion, the presence of these eleven STI stocks trading below their 200-day moving averages signals a broader market sentiment that warrants careful consideration. Investors should conduct thorough research and analysis before making any investment decisions, particularly in the context of the potential risks associated with stocks in a longer-term downtrend. By staying informed and vigilant, investors can better navigate these challenging market conditions.