Singapore shares buck regional declines to close higher; STI up 0.5%

SINGAPORE - Singapore stocks ended higher on Jan 6 despite falls across the region amid the Federal Reserve’s hawkish stance.

The Straits Times Index rose 0.5 per cent or 20.01 points to 3,821.84. Across the broader market, gainers barely beat losers 263 to 258 with 945.4 million securities worth $854.5 million changing hands.

Keppel was the top gainer on the index, climbing 1.7 per cent to $7. CapitaLand Investment fell the most, down 1.5 per cent at $2.64.

All three local banks closed higher: UOB rose 0.6 per cent to $36.80, OCBC Bank climbed 1.3 per cent to $16.79, and DBS Bank was up 0.8 per cent at $43.95.

Across the region, key indexes were mostly in the red.

Japan’s Nikkei 225 shed 1.5 per cent, Hong Kong’s Hang Seng Index fell 0.4 per cent, and the FTSE Bursa Malaysia KLCI was down 0.2 per cent. Meanwhile, South Korea’s Kospi gained 1.9 per cent.

This comes as global markets grapple with the US Fed’s hawkish stance, as well as concerns surrounding US President-elect Donald Trump’s inauguration and the potential policy announcements he may make on tariffs, immigration and taxes.

Fed officials appeared to express caution on further rate cuts over the weekend as they implied there is still some way to go before they can bring inflation down to the 2 per cent target, Maybank Investment Banking Group analysts noted.

They said: “It started off with (Richmond Fed president Thomas) Barkin, who said there (is) ‘more upside risk than downside risk’ to inflation, and noted his preference to keep restrictive rates for longer. He also appeared to believe in labour market strength, as he mentioned that it is ‘more likely to break towards hiring than... towards firing’.

“Under such circumstance, (the) dollar strength looks like it would stay supported although some caution (for a) pullback cannot be ruled out after a strong run.”

THE BUSINESS TIMES