Bulls And Bears

STI ends higher with lift from local banks

Counters rise as investors watch for clues on US monetary policy ahead of inflation data

A strong showing by local banks helped Singapore shares close in positive territory despite concerns that North Korea is reportedly working on a plan to fire four missiles into the sea off the United States island territory of Guam.

Amid the heightened geopolitical tensions, the Straits Times Index still managed to close 0.16 per cent or 5.16 points higher at 3,323.24.

DBS Group jumped 1.14 per cent or 24 cents to $21.26; OCBC Bank gained 12 cents or 1.1 per cent to $11.32; and UOB Group rose 1.1 per cent or 24 cents to $24.53.

Banking counters rose as investors watched for clues on United States monetary policy and economic growth from Fed Bank of New York president William Dudley, a voting member of the Federal Open Market Committee, who spoke last night ahead of inflation data to be released today.

The market also got a boost from Yangzijiang Shipbuilding, which rose four cents or 2.6 per cent to $1.595 after there were more upbeat calls from analysts following its robust results. The Chinese shipbuilder posted a 73 per cent surge in second-quarter net profit to 719.9 million yuan (S$147.6 million) due to higher revenue and lower finance costs.

Yanlord Land Group dipped three cents or 1.6 per cent to $1.79. The Chinese property developer is due to release its second-quarter earnings on Monday.

Macquarie, which has an outperform call on Yanlord, noted that it has obtained a prime redevelopment site in Shanghai's Yangpu district for about 10.52 billion yuan.

Meanwhile, semiconductor- linked stocks continue to sizzle, with shares of contract manufacturer Hi-P advancing nine cents or up 6.9 per cent to $1.39 after posting stellar second-quarter earnings. Its net profit nearly doubled from $7.65 million to $15.1 million, helped by lower cost of sales and lower income tax expenses.

Electronics maker Venture Corp surged to a 10-year high of $16.50 after exceeding analysts' forecasts with a second-quarter net profit of $69.8 million, up nearly 61 per cent from a year ago. But heavy profit-taking took the counter down 10 cents or 0.6 per cent to $15.60.

UOB KayHian, which upgraded its call on Venture to buy, said: "There is an upswing in exports of capital equipment from the US, Europe and Japan. We believe this is a good indicator that demand for Venture's industrial and enterprise products is recovering."

Electronics play AEI Corp surged 27.1 per cent or 16 cents to 75 cents after it announced on Tuesday that it will allot up to 62.5 million shares at 80 cents apiece to New Impetus Strategy Fund for a maximum subscription sum of $50 million. AEI is also proposing a bonus warrants issue.

Other actively traded counters included Rowsley, which lost 1.8 per cent or 0.2 cent to 10.9 cents on trade of 84.8 million shares.

A version of this article appeared in the print edition of The Straits Times on August 11, 2017, with the headline 'STI ends higher with lift from local banks '. Print Edition | Subscribe