The Monetary Authority's measure of core inflation, which excludes accommodation and private transportation costs, may be about 3 percent in the next few months, the central bank and trade ministry said in a monthly statement on price trends today.

“The slight decline in February's CPI was due to the seasonal fall in the costs of non-cooked food and holiday travel and temporary drop” in car permit premiums, the two agencies said. “However, inflationary pressures since late last year have been more persistent than expected.”

Eoin Treacy's view The Strait Times Index is at an interesting juncture, as it ranges in the region of 3000. This level represents the lower side of the overhead congestion area and the upper boundary of the underlying medium-term base. A sustained move above 3000 would confirm a return to medium-term demand dominance. The Financials Index has a very similar pattern. Let us examine a number of Singaporean shares in order ascertain how likely a successful resumption of the medium-term uptrend is.

In the consumer sector Fraser and Neave hit a new all-time high this week, breaking out of a six-month range. Dairy Farm international continues to extend its breakout from the yearlong range. Asia Pacific Breweries found support in the region of the 200-day MA from late November, broke successfully upwards in February and while increasingly overbought, continues to extend the advance.

In the agriculture sector, palm oil plantation owner Golden Agri-Resources has returned to test the upper side of a more than yearlong range. China Fishery Group rallied to break the yearlong downtrend from December and is currently ranging in the region of the 200-day MA. A sustained move below S$1.10 would be required to question potential for additional upside.

In the Healthcare sector, Raffles Medical Group has been ranging for more than a year between S$2 and S$2.50. It will need to sustain a move above the latter area to indicate a return to medium-term demand dominance. Biosensors International found support in the region of the 200-day MA last week and posted an upside weekly key reversal. A sustained move below $2.40 would be required to question medium-term scope for additional upside. OSIM retested the upper side of its six-month range this week but needs to sustain a breakout to confirm a return to demand dominance beyond the short term.

In the Telecommunications sector Starhub (6.56%) reasserted the medium-term uptrend emphatically last week. Mobile 1 (5.8%) has paused, mostly above S$2.40 over the last year. A sustained move below S$2.30 would be required to suggest supply dominance. Singapore Telecom (5.1%) remains largely rangebound.

In the casino sector Genting international has found at least medium-term support and is currently testing the upper side of its six-month range. A sustained move below S$1.50 would now be required to question medium-term scope for some additional upside. Elsewhere the property sector Capitaland (1.96%) rallied to break the more than yearlong progression of lower rally highs in January and has been ranging above the 200-day MA since. A sustained move below S$2.80 would be required to question recovery potential. City Developments rallied to break the more than yearlong progression of lower rally highs by early February and would need to sustain a move below $10.40 to question potential for additional upside.

Jardine Cycle and Carriage remains in a consistent medium-term uptrend. It found support in the region of the MA again in February and a sustained move below S$44.50 would be required to question medium-term upside potential.

Pan Asia Dividend Aristocrat Keppel Corp (3.97%) rallied impressively from the October low. It will need to hold above the 200-day MA if the medium-term upside is to continue to be given the benefit of the doubt. Jardine Matheson Holdings (2.51%) and Jardine Matheson Strategic (0.72%) are also dividend aristocrats and share a similar pattern. Sustained moves back below their respective 200-day MAs wold be required to question medium-term upside potential.

Evidence from the above shares suggests that the Straits Times Index is more likely than not to improve upon its recent performance. (Also see Comment of the Day on July 26th.