Crude prices lead regional bourses to positive territory, STI closes 13 points up

The reception of the Singapore Exchange (SGX).
The reception of the Singapore Exchange (SGX). PHOTO: SINGAPORE EXCHANGE

SINGAPORE - Singapore shares followed the regional markets into the positive territory on Tuesday, when crude oil prices rose and gave investors some reasons to be optimistic at the usually dispirited year-end.

The volume, however, remained lacklustre and analysts do not expect any pleasant surprise this week.

The benchmark Straits Times Index (STI) put on 12.9 points or 0.45 per cent to 2,888.22, but only 710.9 million shares worth $431.2 million were transacted across the whole market.

Remisier Desmond Leong said: "The volume is significantly lower than the 1 billion shares average, so the gain is nothing to be excited about. Still, we have a good chance best to test the 2,900 level given the slow gains in recent days."

The mixed performance of STI came as crude oil benchmark Brent futures stabilised at US$36.6 per barrel (S$51.48), which was up from US$36.62 on Monday after dropping from US$37.89 last Friday.

Asian markets were up as a result, shrugging off the 0.14 per cent drop to Dow Jones Industrial Average overnight. Shanghai gained 0.85 per cent yesterday and Hong Kong was up by 0.36 per cent, while Tokyo rose 0.58 per cent.

Back in Singapore, as many as 22 blue chip counters ended the day on a positive, with Hongkong Land Holdings leading the gainers to close up 11 US cents or 1.59 per cent at US$7.01.

Developers UOL Group and City, Developments Limited (CDL) and CapitaLand were all up. UOL closed up eight cents or 1.3 per cent at S$6.25, while CDL gained eight cents or 1.04 per cent to S$7.75. CapitaLand put on one cent or 0.3 per cent to close at S$3.35.

The outlook for developer counters remains uncertain heading into 2016, Mr Leong said, adding: "The property market here has been depressed for the past one to two years, but I still don't see deregulation at least in the first half next year, and it's hard to say when the government will unwind the cooling measures."

Overall property prices have dropped about 8 per cent in the past two years, latest data provided by the Monetary Authority of Singapore showed, but government officials have repeatedly stated this year that it's premature to adjust the cooling measures given that asset prices are still high compared to the pre-global financial crisis level.

Also facing uncertainties are the energy and offshore marine plays, and Sembcorp Marine was the top losing blue chip yesterday with a 2.5 cents or 1.4 per cent drop to S$1.76. Keppel Corp also dropped, down five cents or 0.76 per cent to S$6.5.

Outside the STI, the penny stocks saw some action. Marble block producer Terratech was still the market's most active, with 63.5 million shares changing hands. It dropped 0.6 cents or 9.84 per cent to 5.5 cents, showing signs that speculators are rotating out of the counter.