Bulls And Bears

All eyes on results as STI stays range-bound

Investors wait for clarity on what a Trump administration really means for markets

Local shares meandered about in an aimless fashion yesterday before ending slightly lower - and out of step with other Asian markets.

The dithering Straits Times Index (STI) hardly moved beyond the 3,000-3,005 range, closing 12.55 points or 0.42 per cent lower at 3,000.22. Turnover was about 1.15 billion shares worth $1.02 billion.

Wall Street fell overnight, partly on US President-elect Donald Trump's statement that the greenback is too strong for his liking.

Some Asian markets benefited as funds were withdrawn from US assets, with Shanghai up 0.14 per cent, Hong Kong rising 1.13 per cent and Tokyo gaining 0.43 per cent.

Investor sentiment here will likely remain a mixture of profit-taking and wait-and-see before more clarity sets in on what a Trump presidency means for the markets and how local firms performed in the fourth quarter.

The big results announcement yesterday came from CapitaLand Commercial Trust (CCT), which ended flat at $1.565 after reporting a 10.1 per cent rise in fourth-quarter distribution per unit to 2.39 cents. This implied a full-year DPU of 9.08 cents.

Two other property trusts were among the 15 STI stocks that fell. Ascendas Real Estate Investment Trust was down one cent or 0.41 per cent at $2.42 and CapitaLand Mall Trust pared half a cent or 0.25 per cent to $1.985.

KGI Securities Singapore trading strategist Nicholas Teo was among those cautious on Reits, pointing to CCT's statement that rents may face further downward pressure.

"Coming from one of Singapore's largest listed Reits and commercial landlords, this warning may be rather significant," he said, while noting that property trusts have enjoyed a solid rebound since November.

Singapore Exchange (SGX) also fell, down one cent or 0.13 per cent to $7.45, ahead of its results announcement later today.

DBS analysts, giving SGX a buy call with a target price of $8.30, are positive on its outlook amid signs of higher turnover. "Securities market activity improved in the fourth quarter 2016. The derivatives segment is also stabilising after steep declines in the second and third quarters," DBS said, adding that SGX's share valuation is now lower than that of Bursa Malaysia and the Hong Kong Stock Exchange.

Meanwhile, 14 STI stocks ended in the black, led by Wilmar International, which added 11 cents or 2.94 per cent to $3.85 on trade of 11.1 million shares.

Keppel Corp rose 11 cents or 1.82 per cent to $6.15 and Sembcorp Industries put on two cents or 0.65 per cent to $3.08, likely on expectations that a potentially weaker US currency will further lift oil prices.

Outside the benchmark, Ying Li International Real Estate was one of yesterday's top actives, with 41.5 million shares traded. The Chinese commercial property developer rose half a cent or 3.05 per cent to 16.90 cents.

A version of this article appeared in the print edition of The Straits Times on January 19, 2017, with the headline 'All eyes on results as STI stays range-bound'. Print Edition | Subscribe