Bulls And Bears

Bargain hunters keep shares above water

STI closes just 0.01% higher ahead of SG50 weekend, release of US non-farm payroll data

Singapore shares closed a hair's breadth inside positive territory as bargain hunters managed to overcome market bears that had sent the bourse down 0.8 per cent at the opening bell yesterday.

The Straits Times Index closed flat, up 0.01 per cent, or 0.35 of a point, to 3,191.39, as traders continued to square their positions ahead of the long SG50 weekend and the release of US non-farm payroll data tomorrow for clues on the timing of the US interest rate lift-off.

Weighing down the index was Genting Singapore, whose second- quarter profit warning sent the casino counter sinking 8.3 per cent, or 7.5 cents, to 82.5 cents, with 61.4 million shares traded.

The mainboard-listed casino operator, which will release its results on Aug 13, said it expects to report a "significant decline" in net profit after tax for the second quarter ended June. "This is due mainly to fair-value loss on derivative financial instruments as a result of unfavourable market conditions and unrealised foreign exchange translation losses," Genting told the Singapore Exchange on Tuesday.

CMC Markets analyst Nicholas Teo said: "The market knows Genting has been suffering losses from declining VIP gaming revenues and they are having a hard time collecting debt from the highrollers. But how much did they lose investing in financial derivatives?"

Noble Group continued to hog the most actively traded list, dropping 5.8 per cent, or 3.5 cents, to 56.5 cents, with 160.4 million shares traded.

"That could be a pullback from Tuesday's 28 per cent rebound," Mr Teo said. "There's also speculation that the former substantial shareholder Invesco may still be selling."

In SGX filings on Tuesday, it was disclosed that fund manager Invesco had last Friday sold 33 million shares at 44.58 cents, bringing its stake down from 5 per cent to 4.5 per cent.

Meanwhile, positive second-quarter earnings posted on Tuesday by Sembcorp Industries helped power the utilities and marine group up 8.7 per cent, or 30 cents, to $3.76.

The company's net profit rose 24.9 per cent to $223.56 million for the three months ended June 30, from a year earlier, on the back of a $54.71 million one-off gain from disposing a unit in April.

Turnover fell 5.8 per cent to $2.39 billion for the second quarter, with weaker contributions from its utilities, marine and urban development segments.

But those declines were mitigated by higher contributions from a unit dealing with "specialised construction activities", the group said.

Bargain hunters also zoomed in on Sembcorp Marine, Keppel Corp and Global Logistic Properties (GLP). Sembcorp Marine gained 4.7 per cent, or 12 cents, to $2.69, while Keppel Corp rose 3.3 per cent, or 24 cents, to $7.62. GLP gained 0.4 per cent, or one cent, to $2.36, with 60.2 million shares traded.

A version of this article appeared in the print edition of The Straits Times on August 06, 2015, with the headline 'Bargain hunters keep shares above water'. Print Edition | Subscribe