Bulls And Bears

STI buoyed by factory data, China-US plans

Market ends the week ahead by 2.3% amid gains by most blue-chip stocks

Local shares ended the week on a high note after two pieces of good news yesterday.

Factory output here for last month defied expectations, while China apparently sought to have tariffs scrapped in exchange for buying more agricultural products from the United States.

The market's direction was clear early with the Straits Times Index (STI) opening 0.2 per cent higher. It built on the positive start and closed at 3,185.53, up 16.66 points or 0.53 per cent, and ahead 71.37 points or 2.3 per cent for the week.

Results were mixed elsewhere in the Asia-Pacific. Australia, China and Japan finished higher, while South Korea was flat and Hong Kong and Malaysia ended lower.

The Nikkei 225 stood out. It added 0.2 per cent with equities listed in the Japanese capital boosted by foreign inflows on the back of a cheaper yen.

Trading volume here stood at 1.09 billion shares worth $965.23 million. Across the market, gainers trumped losers 208 to 176 with only five of the blue-chip index's 30 counters ending in the red.

Talk in the local market for much of the week revolved around Singapore investment firm Temasek's partial offer to raise its stake in conglomerate Keppel Corp to 51 per cent.

Keppel Corp continued to advance yesterday, adding 0.4 per cent to $6.91 on 6.5 million shares traded. It has gained 24.7 per cent since trading resumed on Tuesday, its biggest weekly jump in more than a decade.

The offer for Keppel also fuelled hopes that a similar offer could be made for fellow rig builder Sembcorp Marine, which gained 1.4 per cent to close at $1.42 yesterday. SembMarine is up 18.3 per cent this week.

Such talk took a back seat yesterday as traders took notice of other developments, making for an action-filled session.

Among property plays, Eagle Hospitality Trust (EHT) dived 15.5 per cent to 54.5 US cents after midweek reports that the trust's sponsor could be at risk of defaulting on its lease agreements to run The Queen Mary liner in Long Beach, California.

EHT said yesterday that its sponsor was not in danger of losing its lease but that did little to prevent the slide, with traders seeing opportunity to take advantage of the sell-off to enter positions on the trust.

Singapore Exchange leapt 6.9 per cent to $8.85, a multi-year high, after posting its highest quarterly net profit in more than a decade. It was one of the STI's more active counters with volume of 11 million.

A version of this article appeared in the print edition of The Straits Times on October 26, 2019, with the headline 'STI buoyed by factory data, China-US plans'. Print Edition | Subscribe