Markets buoyed by hopes of Greek resolution

Wall St, regional bourses end higher; rigbuilders hit by Brazil bribe scandal

MARKETS across the region continued to gather momentum yesterday as investors took heart from the constructive talks on Greek debt.

Hopes that the interminable deadlock might finally be broken propelled Wall Street to close 0.58 per cent higher on Monday.

Regional markets were supported by similar sentiment, with the Straits Times Index here up 24.65 points, or 0.74 per cent, to 3,339.78.

It was more robust elsewhere with the Nikkei up 1.87 per cent. The Shanghai Stock Exchange Composite Index ended 2.19 per cent higher after closing for a holiday on Monday, while the Hang Seng Index added 0.93 per cent.

Noble Group here was among the most active counters, with about 37.5 million shares changing hands as it added one cent to 69.5 cents.

Remisier Desmond Leong said the counter "does seem to have bottomed out, at least for the near term", adding: "Some buyers do come in for the technical rebound but it remains to be seen whether (the uptake) will be sustained going forward."

The most active stock was China-based property play Debao Property Development, which rose 0.3 cents to 6.9 cents on trade of 72.9 million shares.

The top blue-chip gainers included Global Logistic Properties, up seven cents to $2.60, and Singapore Technologies Engineering, which was six cents up at $3.31.

Meanwhile, rigbuilding giants Keppel Corporation (KepCorp) and Sembcorp Marine (SembMarine) were hit by re-emerging news of the Brazil bribe scandal.

A Bloomberg report yesterday cited testimony released last Friday by a Brazil court. This alleged that shipbuilders Keppel Fels, a KepCorp unit, and Jurong Shipyard, a subsidiary of SembMarine, were among a group of companies that paid bribes through intermediaries to win contracts for building deep-water drilling vessels.

KepCorp shed one cent to end the day at $8.40, while Semb- Marine pared intra-day losses to close flat at $2.88.

"While these allegations are not new and have been refuted by both Keppel and Sembcorp Marine, new revelations may come with the arrest of Marcelo Odebrecht, the biggest scalp so far in this brewing scandal," said CMC Markets analyst Nicholas Teo, referring to the head of Latin America's largest construction conglomerate, Odebrecht.

"It may also be worth pointing out that neither Keppel Corp nor Sembcorp Marine has announced any major rig orders of significance in the year to date, even as we are about to head into the second half of 2015."

Both companies denied the allegations in February.


A version of this article appeared in the print edition of The Straits Times on June 24, 2015, with the headline 'Markets buoyed by hopes of Greek resolution'. Subscribe