Singapore stocks rise as markets rally following Fed pause, STI up 0.2%

SINGAPORE - Stocks in Singapore closed higher on Thursday, in line with a global rally after the US Federal Reserve kept interest rates unchanged for the second straight meeting.

The Straits Times Index (STI) rose 0.2 per cent or 5.72 points to close at 3,082.49. Across the broader market, gainers outnumbered losers 383 to 217, after 1.2 billion securities worth $926.2 million were traded.

Real estate investment trusts (Reits) were among the top gainers on the STI, with Mapletree Logistics Trust, CapitaLand Integrated Commercial Trust, Mapletree Industrial Trust and CapitaLand Ascendas Reit all rising over 2 per cent on Thursday.

Units of Frasers Logistics & Commercial Trust climbed 3.8 per cent to $1.08, ending at the top of the index performance table. Meanwhile, Sembcorp Industries was the top index decliner, slipping 1.5 per cent to $4.72. DBS was also among the worst performers, with the counter falling 1.1 per cent to $32.66.

Elsewhere, key indexes in Australia, Hong Kong, South Korea, Japan and Malaysia also closed higher, rising between 0.3 per cent and 1.8 per cent.

The Fed on Wednesday said that it

would hold interest rates steady

,

even as policymakers consider whether further hikes are necessary to tame inflation.

Mr Vasu Menon, managing director for investment strategy at OCBC Bank, noted that Fed chairman Jerome Powell repeatedly said the United States central bank was moving “carefully”, which has often signalled a low likelihood of any immediate change in policy.

He added that the short-term outlook “may seem challenging given continued uncertainties”, but the medium-term outlook is more promising, as bond yields could eventually fall in 2024 if inflation cools meaningfully.

“In such an instance, the Fed could pivot to a dovish stance and even cut rates, which has historically been good for equity and bond markets,” Mr Menon said.

THE BUSINESS TIMES