Bulls And Bears

ST Index inches up as sell-off lets up

Most regional stock markets also firm but oil price crisis will continue to fuel uncertainty

Local shares finally stopped their bleeding yesterday with sentiment looking to be on the mend after a heavy sell-off.

The benchmark Straits Times Index rose a marginal 4.72 points or 0.18 per cent to 2,696.5, closing higher for only the second time so far this year.

The market was hardly boisterous but around 1.09 billion shares worth $998.8 million were still transacted.

Most Asian markets were also up, with Tokyo putting on 2.88 per cent while Hong Kong added 1.13 per cent. Sydney gained 1.19 per cent and Kuala Lumpur ended 0.07 per cent higher.

But Shanghai shed 2.42 per cent after an afternoon sell-off wiped out the market's positive start.

Where the markets will go in the near term is still anyone's guess, Fidelity chief investment officer for equities Dominic Rossi cautioned.

"The next earnings cycle in the United States will come in about two weeks' time, and that'll be a big test for the global markets. But overall sentiment is certainly quite fragile. All it takes is another yuan rate reduction, and we'll be back on the slide," he told The Straits Times yesterday.

Singapore companies are entering their results season, with construction firm Lian Beng Group yesterday reporting a 55.4 per cent increase in revenue for the six months to Nov 30 due to higher contribution from residential property joint ventures. Its shares ended flat at 49.5 cents ahead of the announcement.

Gains were made by 17 STI counters. Singtel closed up five cents or 1.42 per cent at $3.58, with 23.5 million shares changing hands. Thai Beverage was also up, rising one cent or 1.48 per cent to 68.5 cents.

Keppel Corp was among the gainers, up four cents or 0.78 per cent at $5.19. But the counter will likely head downwards again as crude oil prices show no sign of recovery.

It remains uncertain how oil prices will move in the coming months, OCBC economist Barnabas Gan said. "The biggest wild card will be the resilience of oversupplies into 2016. The production in the Middle East will likely remain strong, while the lifting of the oil export ban in the US injects further suspense for oil supplies into 2016. Indeed, time is the key storyteller on how prices will react based on this kaleidoscope of factors," he said in a note yesterday.

Other offshore and marine plays were down. Sembcorp Marine dropped four cents or 2.65 per cent to $1.47, while Ezra Holdings pared 0.1 cent or 1.27 per cent to 7.8 cents.

Investors hunting for small and mid-cap plays showed their appetite for Jumbo Group. The seafood restaurant operator has gained around 20 per cent over the past month as the rest of the market languished. Its share price rose three cents or 7.06 per cent to 45.5 cents yesterday.

A version of this article appeared in the print edition of The Straits Times on January 14, 2016, with the headline 'ST Index inches up as sell-off lets up'. Print Edition | Subscribe