Bulls And Bears

STI up slightly on positive earnings reports

Local bourse bucks regional trend as Asian markets shrink amid concerns over US

Local stocks yesterday recouped some of Thursday's losses, thanks to good news on the earnings front.

The benchmark Straits Times Index (STI) closed up 20.99 points, or 0.64 per cent, to 3,314.12 points after a 31.94-point fall the day before, leaving the market 26.69 points up for the week.

Keppel Corp led the way, rising five cents, or 0.77 per cent, to $6.58. The firm announced declines in revenue and net profit for the second quarter, but analysts remain optimistic.

RHB Research Institute Singapore and OCBC Investment Research maintained buy recommendations, with RHB noting that "we think Keppel would be able to play catch-up" in this half of the year, with property and offshore and marine projects in the offing.

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OCBC analyst Low Pei Han noted the meagre second-quarter profit at Keppel's offshore and marine division but said: "Recall that this segment barely broke even" in the quarter before.

She added that Keppel's other segments, such as property, infrastructure and investments, "continued to turn in healthy profits".

Singtel was also ahead yesterday, rising three cents, or 0.77 per cent, to $3.91, after this week's partial divestment of its NetLink NBN Trust stake in an initial public offering.

The gain came despite a Moody's downgrade yesterday afternoon that moved its senior unsecured ratings to A1 from Aa3, albeit with a stable outlook, over what Moody's said was "continued weakening in Singtel's key financial parameters".

The interest in Rowsley continued after billionaire Peter Lim's plan earlier this week to inject healthcare assets into the real estate and investment firm. It closed one cent, or 6.1 per cent, higher at 17.4 cents.

Among real estate investment trusts, CapitaLand Mall Trust was top for value, gaining three cents, or 1.5 per cent, to $2.03 after announcing early yesterday that net property income had grown by 1.2 per cent year on year for the second quarter.

Ascott Residence Trust, where distribution for the second quarter grew 34 per cent on the back of a one-off foreign exchange gain, was higher by 1.5 cents, or 1.26 per cent, to $1.21.

All three local banks marked gains, with DBS up three cents, or 0.14 per cent, to $21.48. UOB rose 32 cents, or 1.35 per cent, to $23.98, while OCBC Bank was up by four cents, or 0.36 per cent, to $11.09.

Fuel company Union Gas Holdings, which debuted on Catalist yesterday, was a little engine that could, closing at 29 cents a share over its list price of 25 cents a share. About 32.4 million shares were traded.

Singapore was the lone star among regional equities yesterday, with markets in Tokyo, Hong Kong and Shanghai registering slight drops amid wariness on the American front.

The greenback has continued to struggle as United States President Donald Trump finds himself in investigative crosshairs and the US Federal Reserve readies for a rate decision next Wednesday.

The euro also strengthened as a hawkish European Central Bank pushed back a decision on possible stimulus tapering.

A version of this article appeared in the print edition of The Straits Times on July 22, 2017, with the headline 'STI up slightly on positive earnings reports'. Print Edition | Subscribe