Many investors claim that the best time to buy a stock is when the price has reached bottom. After all, when one reaches the bottom of the cliff, the only way to go is upwards. In this regard, has DBS share price (SGX: D05) bottomed out or has it gotten ahead of its business fundamentals?
Being one of the leading lights of SGX, DBS share price (SGX: D05) is considered a key barometer of local stock market performance. Amid the disruptions caused by COVID-19 pandemic, many investors scrutinize DBS share price (SGX: D05) for signs of economic recovery.
For sure, 2020 had been such a horrible year for everyone with the implosion of COVID-19 pandemic. Despite the devastating economic impacts of coronavirus, it took only nine months for DBS share price (SGX: D05) to stage a U-shape recovery. By December, the stock has recovered back to the pre COVID-19 levels (the stock was trading around $25 in the latter half of 2019).
In all honesty, the performance of DBS share price (SGX: D05) in the past six months had exceeded my expectations. In my previous articles, my forecast was that the counter should be trading at the bandwidth between $23 to $25. Unexpectedly, DBS share price (SGX: D05) begun to surge in last November, following news of COVID-19 vaccine deployment and Joe Biden being elected as the new USA President.
The buoyant form of DBS share price (SGX: D05) saw the counter hitting as high as $27.40 in early January 2021. In view of a slew of MAS measures which restricted local banks to do shares buybacks and capping of dividends, the bullish form of DBS share price (SGX: D05) confounded many investors. Reality only started to sink in after the release of the full-year financial result for FY2020.
Whilst the worst should be over for DBS share price (SGX: D05), it does not necessarily mean that the share price will continue to rise steadily. In my view, the stock is likely to remain volatile despite the improving economic conditions. The form of DBS share price (SGX: D05) will also hinge on several key factors which I will share in this article.
Note that this is an opinion article and not meant to be a financial advice. Please do your due diligence or engage financial advisors before investing in the stock market. Furthermore, I am not vested and have never invested in DBS Group share before. Whether DBS Group Holdings share price will surge or collapse has no impact on me. Thus, this article is not meant to induce readers to make any form of investment decisions.
DBS share price (SGX: D05) faces another lost decade
In the stock market, confidence means everything. DBS share price (SGX: D05) is no exception. Many analysts argued that in order for DBS share price (SGX: D05) to revive, all signs point to a recovery from COVID-19 crisis. Yet I have a different thesis.
If investors observed carefully, the counter emerged from a multi-year of stagnation in share prices (2006 – 2016) to achieve a winning streak from 2016 – 2018. Based on the historical trend, it seems that there is a strong correlation between DBS share price (SGX: D05) and [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]
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