BullsAndBears

Heavyweight action keeps market positive

Genting, Singtel and UOB post gains while Chinese equities enjoy recovery

A strong showing by index heavyweights such as Genting Singapore and Singtel and a recovery in Chinese equities helped keep Singapore shares in positive territory.

The Straits Times Index closed 0.41 per cent or 12.41 points higher at 3,038.11 yesterday.

Surprisingly strong third-quarter earnings at Marina Bay Sands (MBS) helped lift Genting Singapore by 7 per cent or 5.5 cents to 83.5 cents, with 55.6 million shares traded.

Maybank Kim Eng, which kept a buy call on the stock, noted: "What interests us more is that the third- quarter MBS mass market gross gaming revenue hints that third- quarter Resorts World Sentosa mass market gross gaming revenue may also be stable."

Even so, said analyst Yin Shao Yang, " we take the opportunity to revise our estimates to reflect lower VIP volume post-2016 due to (fewer) Chinese VIPs".


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Other gainers included Singtel, which rose 0.8 per cent or three cents to $3.93, and United Overseas Bank, which rose 0.6 per cent or 13 cents to $20.23.

Across the region, strong buying in small cap stocks helped lift Shanghai by 1.45 per cent and Shenzhen by 3.71 per cent.

Investors are holding out hope that China will announce further stimulus after the Communist Party Central Committee's fifth plenary session starts on Monday, remisier Alvin Yong said. A focus of the market will be the average growth rate that the government sets for the next five years. Analysts expect the target to be lowered from the current 7 per cent.

At home, penny counters remain the most actively traded, with Asia-Pacific Strategic Investments plunging 53 per cent or 1.7 cents to 1.5 cents, with 81.7 million shares traded, as it went ex-rights. The firm is giving shareholders the option to buy two rights shares for every one share held and one warrant for every one rights share taken.

Speculative interest helped Rowsley gain 5.8 per cent or 1.1 cents to 20 cents, with 70.8 million shares traded. The real estate vehicle of billionaire Peter Lim will announce its third-quarter earnings to Sept 30 after trading hours on Nov 4.

Shares of Informatics Education skyrocketed 41 per cent or 1.6 cents to 5.5 cents, with 66.8 million shares traded.

The Singapore Exchange gained 0.5 per cent or four cents to $7.55 after it posted better-than-expected first-quarter results. SGX net profit rose 28 per cent to $99.3 million from a year earlier, as operating revenue jumped 30.1 per cent to $219.6 million. Operating revenue from securities grew 13.8 per cent to $55.9 million.

OCBC Investment Research, which upgraded its call to buy, said it "expects SGX's derivatives business to continue to spearhead growth and we are projecting a 25.5 per cent increase in derivatives revenue in full-year 2016".

A version of this article appeared in the print edition of The Straits Times on October 23, 2015, with the headline 'Heavyweight action keeps market positive'. Print Edition | Subscribe