SINGAPORE - Asian markets remained bullish and their post-Brexit rally continued apace. But market watchers are not yet convinced that the way ahead is Singapore's benchmark Straits Times Index added another 48.2 points or 1.73 per cent, in a bullish session that saw S$1.7 billion worth of shares changing hands across the whole market.
Hong Kong rose 1.75 per cent, Tokyo weakened through the day but was still up 0.06 per cent, and Kuala Lumpur put on 0.72 per cent. Shanghai was down 0.07 per cent.
The regional gains on Thursday (June 30) took cue for a 1.64 per cent increase to Dow Jones Industrial Average at Wall Street.
However, London's FTSE 100 started to show signs of cooling, opening in early trading, while Sterling stayed range-bound around 1.34 against the greenback.
"While global indices have recovered markedly, the sterling pound is still weak, which suggests that investors are buying back equities not because they feel sanguine about Britain," IG markets strategist Bernard Aw said.
OCBC investment research head Carmen Lee is also cautious: "Volatility is likely to remain in the market due to a couple of factors, including the impact of the Brexit on the rest of Europe and on Britain, slower global economic growth.
"As of now, it looks like there is a growing probability of no hike for this year and even expectations from some economists of a cut in interest rate. And then there's the US Presidential election at the end of the year. This will continue to add to the uncertainty in the market."
Against this backdrop, investors should go for defensive sector, especially telecommunications and local real estate investment trusts for their decent yields, Ms Lee added, naming SingTel as OCBC's top telco pick.
SingTel was one of the 26 STI component stocks that rose Thursday, closing up nine cents or 2.23 per cent at S$4.13. It was also one of the hottest counters, with 48.9 million shares traded. StarHub was up four cents or 1.07 per cent to S$3.79.
The top gaining blue chip was Hutchison Port Holdings Trust, rising two US cents or 4.6 per cent to 45.5 US cents. Golden Agri-Resources added 1.5 cents or 4.48 per cent to 35 cents, while Singapore Press Holdings put on 10 cents or 2.6 per cent to S$3.95.