STI rises for 4th straight day in holiday-shortened trading

Local shares enjoyed this week's modest Santa rally to rise for a fourth consecutive day, with traders showing optimism heading into the year-end holidays.

The benchmark Straits Times Index (STI) climbed 0.37 per cent, or 11.47 points, to close at 3,108.28 on what was a fairly lacklustre half-day of trading. The trifling gains were not enough to prevent the STI ending the week down 0.1 per cent.

The increase tracked gains in most regional markets yesterday. This followed Wall Street's rally on Thursday, where key indexes rose between 0.6 per cent and 0.9 per cent, with the S&P 500 closing at a new record, largely on hopes that the new Covid-19 variant would not wreak havoc as initially feared.

Mr Vishnu Varathan, head of economics and strategy at Mizuho Bank, said in a note that there may be temptations among investors to declare the overnight gains in equities and a softer United States dollar as "risk on".

But he said it would be a "gross mischaracterisation" to suggest that this is a "rally where bulls may flourish with abandon".

He said the markets would still be awaiting clarity on a range of factors, including the impact of the Omicron variant and the US Federal Reserve's path to hike rates.

There was not much to write home about on the local bourse, given the shortened Christmas Eve trading day and prospect of a long weekend distracting investors.

Gainers outpaced losers 214 to 122 after 497.5 million shares worth $272.6 million changed hands.

ST Engineering was the STI's top gainer, rising 1.1 per cent to $3.74.

Only two STI counters finished in the red: Jardine Matheson fell 0.05 per cent to US$55.69, while Dairy Farm International declined 0.7 per cent to close at US$2.73.

Across the broader market, shares of Catalist-listed Metech International were among the top actives, with the counter rising 1.4 per cent to 36.5 cents after 24.3 million shares were traded.