Bullish regional markets push indices up, STI closes 15 points up

SINGAPORE - Singapore shares joined regional markets in another bullish session that pushed indices to multi-week high. But the strength of the rally is uncertain as the choppy economic outlook may dampen sentiments going forward, remisiers cautioned.

The MSCI Asia ex-Japan index gained 0.2 per cent on Friday, with China's benchmark Shanghai Composite putting 1.6 per cent for the day and 6.5 per cent for the week, its best performance in four months.

This followed the 1.28 per cent jump of Dow Jones Industrial Average overnight, due partly to better than expected results by major corporates such as Citigroup that drew cheers from investors.

"You may have no rate hike this year from the Federal Reserve and an extension of stimulus in Europe and in Japan so that's giving a boost to equities. At the same time, crude rebounded, and earnings in the United States were not so bad," Mirabaud Securities trader John Plassard told Reuters.

Taking cue from Wall Street, Kuala Lumpur also gained, up 0.21 per cent to its highest since early August, while Tokyo rose 1.08 per cent.

Singapore's benchmark Straits Times Index was up 15.47 points or 0.51 per cent to 3,030.61. For the week, the index increased by 1.07 per cent.

Remisier Chung Chun He told the Straits Times: "We're seeing a nice rebound for the local market, but I think it's still too early to tell whether this is a sustainable recovery. Global economy outlook is still very much a concern, and markets will likely go south the moment new downbeat data comes out."

The next key data to watch is the official growth figure of China, to be announced next Monday. Most market watchers are wincing for a sub-7 per cent growth rate, but how low it goes will dominate market mood in the coming week.

Still, there were plenty of bright spots in the local market yesterday, with Noble Group coming on top the STI for the third straights day. Shares of the commodities firm went up one cent or 2.02 per cent to 50.5 cents.

This marked a 32.9 per cent surge since Oct 6 when Noble hit its full-year low at 38 cents. But Mr Chung doubted that the embittered firm - which has been fighting both short-sellers and a global commodity down-cycle for almost a year - has truly turned a corner.

"It rose as part of the market, but fundamentals of the company and its business environment remain unchanged. I don't expect any pleasant surprises in its third quarter results."

Hongkong Land Holdings ended 13 US cents or 1.73 per cent higher at US$7.63, and Yangzijiang Shipbuilding rose two cents or 1.6 per cent to S$1.27.

Outside the STI, Singapore Post went up eight cents or 4.47 per cent to S$1.87. This followed the news this week that the company is planning to acquire e-commerce unit TradeGlobal in the United States to expand its business.

whwong@sph.com.sg