It’s Time To Take Profits on Singapore Banks.

Singapore banking stocks opened lower on Thursday (Feb 24), in view of extending losses on Wall Street amid Russia and Ukraine confrontation.

The recent results of Singapore banks have not been fantastic, with both DBS and OCBC bank missing analysts’ expectations.

DBS (SGX: D05): DBS Earnings Miss Forecasts Despite Plunging Allowances

DBS Group recent results showed its net profit for the fourth quarter grew 37 percent from a year earlier to S$1.39 billion, missing a forecast from a Reuters poll of four analysts.

The miss came despite total allowances tumbling after repayments of what the bank called two significant non-performing loans in the quarter.

But all of that wasn’t enough to overcome the negative impact of interest rate cuts early in the pandemic and the exceptional investment gains afterward when markets posted a stunning recovery.

Source: Finews.asia, Smartkarma

DBS (SGX: D05) exhibited technical breakdown yesterday (24 Feb 2022) after a 3-month uptrend (establish since end of Nov 21), the uptrend channel line has been broken and the stock is exhibiting a technical breakdown yesterday (24 Feb 2022).

Resistance is capped at 36.50, could correct to 33.81 and 32.70 in the short term from its current price of 34.95 (at the point of this write up), if weakness persist the stock could correct back to 31.05 and 29.87 in the longer term.

Cut loss above 36.50.

OCBC (SGX: O39) - Another Weak Print

OCBC reported 4Q21 net profit of SGD 973 million, an SGD 251 million (20.5%) decrease on a linked quarter basis.

If not for the 51.8% decline in Singapore not performing loans (NPLs), credit quality would have been disastrous for OCBC, reserves would appear to now be waning by more than SGD 2.8 billion or nearly three quarters of bottom-line results.

Source: Finews.asia, Smartkarma

OCBC (SGX: O39) similar to DBS exhibited bearish price action yesterday (24 Feb 2022) , after a 3-month uptrend (established since end of Nov 21), the uptrend channel line was broken upon their results announcement (23 Feb) and the stock is exhibiting further short-term bearish price action yesterday when it broke the 12.38 support level.

Resistance is capped at 12.69, could correct to support levels of 11.70, 11.38 and 10.98 in the short term from its current price of 11.92.

Cut loss above 12.69.

All posts and charts are for educational and illustration purposes only