Bulls And Bears

Late buying spree nudges STI up

Gains led by banks, but sentiment edgy ahead of key US central bank meeting

An eleventh-hour buying spree helped nudge local shares into positive territory yesterday, although the writing was on the wall for a correction ahead of a key central bank meeting and Monday's big gains.

After being below water for much of the day, the Straits Times Index (STI) managed to eke out small gains in the final minutes to rise 5.09 points, or 0.15 per cent, to 3,465.54. The gains were led by the three banking stocks, as well as rises in Keppel Corp and Singtel.

Sentiment remained edgy ahead of a two-day United States Federal Open Market Committee session - the most significant gathering in a week jam-packed with central bank meetings.

The strong overnight lead from a buoyant Wall Street hitting fresh records was evidently not enough as other key Asian bourses struggled to stay in the black. Key indices in Japan, Hong Kong, South Korea and China closed lower, while Australia and Malaysia reaped gains.

Data out here yesterday show that retail sales continued to decline in October from a year earlier, although the slowdown was more moderate compared with September's decline.

The STI is up just over 20 per cent this year and may still go higher.

DBS Group Research said Singapore remains one of the few regional markets where the benchmark index is still trading below the all-time high. "The valuation still does not look stretched," it said.

Its optimism is premised on corporate earnings recovery this year after declines in 2015 and last year - a recovery that could be sustained into the next two years.

DBS added that the STI could hit 3,688 by the end of next year, representing a 10 per cent total return inclusive of dividends.

Turnover yesterday was 1.6 billion shares worth $994 million, with gainers outpacing losers 239 to 172.

Thai Beverage gained 0.5 cent, or 0.5 per cent, to 95.5 cents. It was reported that a ThaiBev unit submitted a bid to acquire a stake in Vietnam's largest beer-maker in a deal worth at least US$2.25 billion (S$3 billion).

Catalist-listed Infinio Group was the most active, jumping 50 per cent to 0.3 cent with about 84 million shares done before trading was halted at noon, pending the announcement that it has inked an agreement for an unsecured interest-free loan of nearly $3 million.

Noble Group continued to climb for the second straight day, adding 4.8 cents, or 34 per cent, to 19 cents with about 29 million shares done. The commodities trader said it had completed the sale of a unit dealing in coal sales for US$35 million.

A version of this article appeared in the print edition of The Straits Times on December 13, 2017, with the headline 'Late buying spree nudges STI up'. Print Edition | Subscribe