With Singapore’s circuit breaker ending in 1 week, is it time to consider investing in the stock market?

The Singapore stock exchange closed last Friday just below the 2,500 support level. This is about 200 points higher than the lowest in the last 2 months. With the Singapore circuit breaker ending on 1 Jun 2020, is it time to consider investing in the stock market? Will stocks rise again post-circuit breaker?

It is important to note that while activities will re-start, they won’t reach the same rigour experienced before 7 Apr 2020. It will be a cautious restart which may take some time to reach previous levels. But it is also true that this is the time to consider entering the stock market since bear market situations don’t come by often.

What would be some dark clouds that might delay the return of the bull market? US-China relations is one major issue – the trade war, the coronavirus blame game, etc. These are major issues that can rock the markets. In addition, business models have been disrupted – some companies may not survive the recent downturn. Others will change the way they operate going forward. Demand for offices may slow down with people getting used to working from home.

Yes, take a hard look at stocks. Study the business & business-models of the companies carefully. Are they in resilient industries? Have they re-engineered themselves? Will demand for their products/services improve post-circuit breaker? At the end of the day, you are evaluating the value of these companies.

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