BullsAndBears

Banks and oil-related counters make gains

Singapore bourse continues good run as oil prices rise and rate hike looks unlikely

The Singapore market extended gains for the fifth straight session yesterday, tracking positive United States leads and higher oil prices.

The benchmark Straits Times Index (STI) climbed 14.29 points, or 0.5 per cent, to 2,862.38.

Wall Street had inched up 0.1 per cent overnight, helped by rallies in energy and airline stocks, while expectations for a near-term interest rate hike continued to wane. Other markets in Asia were a mixed bag: Tokyo rose 0.93 per cent, while Shanghai slid 0.3 per cent as traders stayed on the sidelines ahead of a long weekend, and as monthly data showed China's exports fell more than expected last month. Hong Kong slid 0.14 per cent.

The data from China suggested "things have stabilised, which is better than what it was a few months ago, but stabilisation does not mean a bull market", Mr Khiem Do, the Hong Kong-based head of multi-asset strategy at Baring Asset Management, told Bloomberg.

"Most people are still a little bit careful and cautious."

The STI's performance was helped by the local lenders. DBS Group Holdings firmed 14 cents or 0.9 per cent to $15.93, United Overseas Bank advanced 15 cents or 0.8 per cent to $18.98 and OCBC Bank put on two cents or 0.2 per cent to $8.84.

The bulk of the action was centred on oil and gas-related plays as oil prices hit fresh highs, following an industry report that showed a decline in US crude stockpiles. Keppel Corporation jumped 27 cents or 4.9 per cent to $5.73. Sembcorp Industries shot up 12 cents or 4.1 per cent to $3.02, while its rig-building arm Sembcorp Marine rose four cents or 2.4 per cent to $1.725.

StarHub also did well, adding nine cents or 2.5 per cent to $3.69.

The day's biggest laggards included real estate group City Developments, which fell 15 cents or 1.7 per cent to $8.85, and ST Engineering, which shed three cents or 0.9 per cent to $3.20.

Outside of the STI, commodity trader Noble Group rose 1.5 cents or 6 per cent to 26.5 cents after two days of heavy selling. Offshore service provider Ezra Holdings was the top active, with a turnover of 374.1 million shares. The counter, which was put on a trading halt at around 4.30pm pending the release of announcements, jumped 1.8 cents or 25 per cent to nine cents.

"Since (Tuesday) there has been rampant speculation that the company has secured the necessary financing for some contracts... and was due to make the official announcements," a trader said in a NetAsia Research report.

Other actives included those in the energy industry, such as AusGroup Singapore, Vallianz Holdings, Rex International Holding and Loyz Energy. AusGroup, for instance, soared 2.3 cents or 44.2 per cent to 7.5 cents on 78 million units.

Total trade across the bourse was a healthy 1.74 billion shares worth $1.05 billion.

A version of this article appeared in the print edition of The Straits Times on June 09, 2016, with the headline 'Banks and oil-related counters make gains'. Print Edition | Subscribe