Bulls And Bears

STI rises 0.9% as region reverses Monday's sell-off

Gold, oil prices pull back as fears of Iran reprisal against US temporarily recede

Singapore equities along with their regional counterparts reversed Monday's losses, and prices of both gold and oil pulled back as fears of reprisal by Teheran over the US assassination of a top Iranian commander temporarily receded.

"It's called Turnaround Tuesday for a reason," AxiTrader chief Asia market strategist Stephen Innes said of the early-session recovery seen in the region's markets.

The benchmark Straits Times Index (STI) jumped at the opening bell before holding relatively steady until the end of the session. The blue-chip index closed at 3,247.86, after an advance of 29 points or 0.9 per cent.

It was similar elsewhere in the Asia-Pacific. Australia, China, Japan, Hong Kong, Malaysia and South Korea were markedly higher.

Bucking the trend was Taiwan, with the Taiex Index falling 0.6 per cent to close at 11,880.32. It was weighed down by the New Taiwan dollar strengthening to a 11/2-year high against the greenback.

Monday's sell-off was representative of the tendency of markets to have the memory of a goldfish. Removing US-Iran tensions from the equation, the global economy is continuing along the path of recovery and monetary policy remains accommodative - two key conditions supporting equities.

As such, traders noted there were ample opportunities to take advantage of the sell-off and buy on the dip. Observers are expecting more volatility this week, especially after news that Iran is assessing scenarios of retaliation against the United States.

Trading volume in Singapore stood at 1.5 billion securities. Total turnover clocked in at $1.19 billion.

Advancers trumped decliners 248 to 161. Only one out of the STI's 30 counters ended in the red.

Singtel spent most of the session lower before edging up late in the day to close one cent or 0.3 per cent higher at $3.36. The telco said fires in Australia affected parts of Singtel subsidiary Optus' telecom network in New South Wales and Victoria.

ComfortDelGro also recovered to end two cents or 0.9 per cent higher at $2.34. On Monday, the transport operator said none of its bus services in the Australian states of New South Wales, Victoria and Queensland had been directly affected by bush fires.

The local lenders notched gains too. DBS Group Holdings added 19 cents or 0.7 per cent to $26.05, OCBC Bank gained eight cents or 0.7 per cent to $11 while United Overseas Bank finished at $26.70, advancing 33 cents or 1.3 per cent .

A version of this article appeared in the print edition of The Straits Times on January 08, 2020, with the headline 'STI rises 0.9% as region reverses Monday's sell-off'. Subscribe