Bulls And Bears

STI ends flat amid profit-taking

It closes 0.7 point lower, but is up a hefty 4.6% in 'good week' after months of carnage

Singapore shares ended mostly flat after investors took profit on the final trading day of what some call "one of the best weeks in a long time".

The Straits Times Index closed just 0.03 per cent or 0.7 point lower at 2,656.87, but was a hefty 4.6 per cent higher for the week.

Remisier Desmond Leong said: "The fact that the market can stay at near resistance levels of between 2,655 and 2,665 for the past four days is a good sign. We haven't seen that kind of strength for a long time." He added: "Previously, whenever the market touches resistance, it tends to come off immediately.

"We can't tell for now if the market is bottoming, or is in a technical rebound, because we have only had one good week compared with months of bloodshed."

Among the top gainers were OCBC, which rose 0.8 per cent or six cents to $7.98; Wilmar International, which rose 1.6 per cent or five cents to $3.16; and Genting Singapore, which climbed 2.1 per cent or 1.5 cents to 72 cents, with 36.8 million shares traded.

DBS Group Research, which has a hold call on Genting Singapore, said its VIP business is slowing as VIP customers have avoided casinos across Asia, amid Beijing's anti-corruption and austerity drive.

"Combined with the slowing Asian economies, Genting is tightening its credit criteria to reduce bad debt risk. And with the weaker-than-expected fourth-quarter results, we now project a 21 per cent decline in VIP rolling chip in full year 2016 from minus 5 per cent previously," it said. Still, DBS noted that Genting has a strong balance sheet, with net cash of $3.5 billion.

"It is well positioned to take advantage of opportunities in new casino markets or to conduct share buy-backs and raise its dividend to temper any share price decline."

OCBC Investment Research, which has a sell call on the casino operator, said it believes there could still be "room for casino revenues to ease this year, given the uncertain economic outlook globally, but remains hopeful of a recovery in 2017".

OCBC has a buy call on Wilmar, saying its management believed that it has done "satisfactorily" despite the challenging environment.

Meanwhile, local shares were weighed down by DBS Group, which fell 1.5 per cent or 21 cents to $13.68, and CapitaLand which lost 1.4 per cent or four cents to $2.87.

Mr Leong said: "Investors didn't want to hold DBS stock over the weekend ahead of its (full-year) earnings results on Monday."

Singtel dropped 0.8 per cent or three cents to $3.73 on talk of a fourth telco here.

Among the most actively traded were Spackman Entertainment, which soared nearly 25 per cent or 2.2 cents to 11.1 cents, with 138.9 million shares traded.

Noble Group dipped 2.7 per cent or one cent to 36.5 cents, with 40.4 million shares traded.

A version of this article appeared in the print edition of The Straits Times on February 20, 2016, with the headline 'STI ends flat amid profit-taking'. Print Edition | Subscribe