Bulls And Bears

STI up on stronger sentiment, Wall St gains

Market buoyed by strong earnings performances in US

Local stocks finally found positive territory this week with local investors cheered by overnight gains on Wall Street.

The better mood sent the Straits Times Index (STI) up 19.62 points or 0.62 per cent to 3,190.73.

Traders seized on strong earnings performances in the United States, although there was precious little else for them to go on with silence on the US-China trade war and the government shutdown.

Turnover was 1.45 billion shares worth $1.02 billion with gainers and losers evenly matched, 198 to 184.

Jardine Matheson Holdings surprised investors early on with an 83 per cent plunge that wiped out US$41 billion (S$55.8 billion) in share value. About 167,500 shares were transacted in pre-market trading at US$10.99, compared with Wednesday's close of US$66.47. Bloomberg data said the trading volume was almost 60 times the 20-day average for that time of day.

The Singapore Exchange said the orders were not due to "fat finger" errors or any malfunctioning systems and that it would not be cancelling the trades. The shares quickly recovered and traded higher to close at US$66.82, up 0.53 per cent on the day.

Genting Singapore topped active counters with 54.5 million shares traded. The casino operator lost 2.75 per cent to $1.06, one of only three STI constituents to dip.

CapitaLand Commercial Trust was another active, rising 1.09 per cent to $1.85 on volume of 13.7 million. The trust reported higher distribution per unit yesterday for the fourth quarter, on the back of higher net property income.

Mapletree Commercial Trust gained 2.91 per cent to $1.77 after 8.2 million units changed hands. It reported better third-quarter numbers on Wednesday. OCBC Investment Research downgraded the trust to "hold" yesterday on limited upside potential, noting that its unit price has appreciated 5.5 per cent since the bank initiated coverage in November with a "buy" call.

Meanwhile, DBS Group Research retains its "buy" call on the trust.

"Detractors believe that MCT is due for a de-rating given the threat of e-commerce that can affect earnings at VivoCity," analysts Mervin Song and Derek Tan said. "However, this ignores management's ability to undertake asset enhancement initiatives to partially future-proof the mall."

Sino Grandness Food retreated 30.1 per cent to 7.2 cents with 8.08 million shares traded. The canned goods producer said on Wednesday night it had been served another letter of demand over a sum of about US$22 million. Lender Soleado Holdings wants payment in two weeks.

A version of this article appeared in the print edition of The Straits Times on January 25, 2019, with the headline 'STI up on stronger sentiment, Wall St gains'. Print Edition | Subscribe