Global markets up despite caution by local investors

The benchmark Straits Times Index closed up 6.64 points, or 0.19 per cent, to 3,430.0 - the highest since May 2015. Gainers closely outnumbered losers 231 to 218.
The benchmark Straits Times Index closed up 6.64 points, or 0.19 per cent, to 3,430.0 - the highest since May 2015. Gainers closely outnumbered losers 231 to 218.PHOTO: REUTERS

SINGAPORE - Local traders were cautious on Wednesday (Nov 22) ahead of domestic growth and inflation numbers but they still sent the market to levels reminiscent of the good old days.

The benchmark Straits Times Index closed up 6.64 points, or 0.19 per cent, to 3,430.0 - the highest since May 2015. Gainers closely outnumbered losers 231 to 218.

CMC Markets Singapore analyst Margaret Yang noted on Wednesday morning that Prime Minister Lee Hsien Loong's hints of impending tax increases have not yet hit trading activity.

"Markets take more of a gradual 'phase-in' and expect government to conduct proper communication with the public before executing any tax hikes," she noted.

Blue-chip stalwarts did their part. Singtel rose one cent to $3.70 while Keppel Corporation, whose Keppel Land unit is shedding a Bali site that languished for years despite a planned redevelopment, added four cents to $7.53.

DBS Group Holdings put on 45 cents, or 1.85 per cent, to $24.84, OCBC Bank finished nine cents ahead at $12.01 while UOB dipped two cents to $25.77.

DBS Equity Research noted: "The Singapore banks have had a fantastic rally in 2017", adding that "we believe (in their) ability to keep a clean asset quality trend would be the most crucial factor to shift valuations above mean".

Among property stocks, New Wave Holdings continued to waver on the failure of Jalan Besar Plaza's collective-sale tender, losing 0.1 cent, or 7.14 per cent, to 1.3 cents.

Meanwhile, UOL Group, which must consolidate its 99.683 per cent stake in Singapore Land in a mandatory unconditional cash offer, sank 10 cents, or 1.12 per cent, to $8.86.

The stock had previously enjoyed a boost from UOL upping its interest in United Industrial Corporation (UIC), which owns SingLand.

UIC itself put on six cents, or 1.81 per cent, to $3.38.

Asiasec Equities analyst Manny Cruz in Manila told Reuters: "A strong Wall Street has spilled over to Asian equities."

The Dow closed up by 0.69 per cent on Tuesday, and the Nasdaq by a strong 1.06 per cent, with gains in tech equities helping United States investors to shake off worries over tax reform prospects in Congress.

Asia was also fizzy, with Seoul up 0.39 per cent, Tokyo added 0.48 per cent and Shanghai rose 0.59 per cent.

Hong Kong's Hang Seng jumped to its highest in a decade, rising 0.62 per cent to cross 30,000 points.

The index was helped by Chinese giant and WeChat owner Tencent, which on Monday became the first Asian tech firm to reach a market cap of more than US$500 billion.

All eyes on Thursday will be on Singapore's final gross domestic product figures for the third quarter, due at 8am, and inflation numbers, set for release at 1pm.