Bulls And Bears

STI at highest since 2008 amid slow ascent

Slight rise follows mixed signals from Wall Street; losers include tech stocks

Local shares continued their slow ascent after Tuesday's breather and ended the day at their highest close since 2008.

The Straits Times Index (STI) inched up just 1.35 points, or 0.04 per cent, to 3,615.28 yesterday, but it marked a milestone for market watchers.

About 2.2 billion shares worth $1.8 billion were traded, with losers outpacing gainers 259 to 192.

The STI's slight rise followed mixed directions on Wall Street, where the Dow was dragged down by a drop in a key United States manufacturing indicator on Tuesday, while the S&P 500 index enjoyed a boost from the tech sector ahead of Apple's earnings release.

As it turned out, the tech giant did deliver, with profits of US$2.73 per share, beating expectations of US$2.68 per share, plus a US$100 billion (S$133 billion) cash return to boot.

iPhone sales, however, missed consensus. Asian markets read this negatively, given the number of supply chain players in this region that make parts for the iPhone.

This also comes amid recent weak earnings from Singapore-listed electronics and semiconductor companies, which further contributed to the languishing tech sentiment on the local bourse.

Venture Corp shares have shed more than $10 since April 1, falling $1.53, or 7.3 per cent, to $19.42 yesterday.

Analysts have warned that the stock could be oversold. CGS-CIMB said on April 20: "There is insufficient basis to slash our estimates for Venture at this juncture. Our target price remains at $30.81. However, the clouds of trade/tech war between the US and China could soften sentiment on Venture."

Chipmakers continued to underperform yesterday. AEM Holdings slid 50 cents, or 8.2 per cent, to $5.60, while Sunningdale Tech lost two cents to $1.28, following a DBS downgrade last week from "buy" to "hold". DBS also lowered Sunningdale's target price from $2.70 to $1.53 after its earnings fell below expectations.

The market found support from OCBC Bank, which added 16 cents to $13.96 on a general bullishness on banks.

Hongkong Land was another winner, adding 10 US cents to US$7.35, after finalising its 2017 dividend at 14 US cents, a one-cent year-on-year increase in total payout.

Singapore Airlines rose 25 cents to $11.13, after announcing it had added its budget brand Scoot to its frequent-flyer programme for small and medium-sized enterprises.

A version of this article appeared in the print edition of The Straits Times on May 03, 2018, with the headline 'STI at highest since 2008 amid slow ascent'. Print Edition | Subscribe