More volatility may be on the cards for local stocks, with the thinking of the United States Federal Reserve on interest rates set to hog the spotlight again this week.
Traders are eyeing the release of the minutes of the March Federal Open Market Committee meeting on Thursday. Several senior Fed officials are also expected to speak in public forums this week.
Also on their radar is Fed chairman Janet Yellen's panel discussion with the central bank's former chiefs Ben Bernanke, Alan Greenspan and Paul Volcker on Friday.
Last week, Dr Yellen's signals that she was in no rush to raise US interest rates amid a sluggish global economy sent bourses worldwide soaring, including Singapore's, which surged almost 54 points last Wednesday.
But the rally was cut short, partly after Moody's Investors Service lowered the credit rating outlook of local banks from stable to negative, citing concerns over asset quality and profitability. Banking stocks were hammered, and the Straits Times Index closed down 1.01 per cent for the week.
Mr Lim Say Boon, DBS Bank's chief investment officer, noted: "In the face of the equities bear - and we believe the downtrend will resume soon - what can private investors do to avoid losses in real or absolute terms in the value of their portfolios?"
"Well, they can short the markets if they are nimble, skilful, and have the stomach for the violent... volatility we have been seeing since August last year. Otherwise, return to fixed income," he said.
And with the global economy still struggling "way below feast but perhaps only a shade above famine... ultra-low, zero and negative interest rates will likely be with us for a long time", he said.
Even with a much better than expected March US job report last Friday that beat estimates, many traders still do not expect higher rates until June or even later in the year.
Dr Yellen last week reiterated proceeding "cautiously" on raising rates, noting "ongoing risks" from China and other concerns.
US employers added 215,000 jobs in March, with the unemployment rate edging up to 5 per cent. Forecasts were for non-farm payrolls to show growth of 205,000 for March.
But central bank officials are waiting for signs of a breakout in wages that could push overall inflation closer to the Fed's 2 per cent target.
The Dow Jones Industrial Average rose 0.61 per cent to 17,792 points on Friday, its highest since Dec 4.
Market participants are waiting for Singapore's Purchasing Managers' Index (PMI) data due later today as well as the International Monetary Fund's latest World Economic Outlook on Wednesday.
Meanwhile, oil's six-week winning streak appears to have snapped on signs that the world's biggest exporters may fail to complete a deal to freeze their output.
Saudi Arabia has said it will freeze its output only if Iran and other major producers do the same, making a deal between the kingdom, Russia and other producers look less likely. Brent fell 4.1 per cent to US$38.67 a barrel in London.
Weak oil prices are likely to continue weighing on oil-related counters such as Keppel Corp, which closed down 0.9 per cent or five cents at $5.78.
"Keppel's recent price surge (from a low of $4.71 on Jan 26) was likely driven by oil price sentiments rather than fundamentals. Historically, Keppel's stock price has been strongly correlated to oil price. Past oil rallies brought about fresh rig orders," Maybank Kim Eng said.
"But even if oil prices rebound to US$40-US$50 a barrel, that is unlikely to be sufficient to generate confidence for new rig orders. The industry also has to deal with a rig supply glut. Instead, we believe that there could be more rig deferrals or even cancellations," it said.
