Higher earnings and dividends
At the Smart Investor, we like to focus on the business behind the stock. As long as the business is demonstrating improved revenue and profits, its share price should rise in tandem. Dividends are another key factor you shouldn’t miss. And as companies grow their profits, they can also pay out increasing dividends. As these dividends head higher, investors will also bid up the price of the shares along the way. Hence, a useful method to check if a rally is justified is to look at the earnings...There is a feeling of optimism in the air.
The Straits Times Index (SGX: ^STI) or STI has surpassed its previous all-time high set in 2007, punching above the 4,000 level.
What’s more, the bellwether index has also stayed above this level for three consecutive sessions as of this writing.
Increasingly, investors are confident that the rally is here to stay.
But, can the STI continue to break new highs?
