STI closes higher as markets shrug off N.Korea provocations

People watch a television news screen showing file footage of a North Korean missile launch, at a railway station in Seoul on Aug 29, 2017.
People watch a television news screen showing file footage of a North Korean missile launch, at a railway station in Seoul on Aug 29, 2017.PHOTO: AFP

SINGAPORE - Stock markets appeared to push aside Pyongyang's latest provocations on Wednesday (Aug 30), with risk appetite returning to lift most bourses higher after the initial knee-jerk reactions.

On Tuesday, North Korea fired a ballistic missile over Japan's northern Hokkaido island, leading to 100 point drop in Dow Jones at open. The market had later shrugged off the morning jitters to reverse its losses and finish in a positive range Tuesday.

"It seems that it takes more than a few rockets fired over Japan to deliver a prolonged and meaningful market reaction in a world where a wall of central-bank printed money is waiting for any sign of a dip to come in and start buying," said ING head of Asia research Rob Carnell in a note.

The Dow Jones Industrial Average rose 0.26 per cent overnight on Tuesday as the probability that the US Federal Reserve would notch up interest rates a third time this year fell below 30 per cent against the more cautious outlook.

On Wednesday, the Hang Seng Index gained 1.19 per cent. At home, the Straits Times Index (STI) closed 0.49 per cent higher at 3,265.26. Overall, turnover on the Singapore bourse reached $1.02 billion on volme of 1.94 billion. Gainers outnumbered losers 242 to 186.

Rowsley was the top active, followed by QT Vascular and OLS.

Shares of civil engineering firm Swee Hong rose 0.1 cent or 5.56 per cent to 19 cents, making it the fifth most traded counter. Overnight, Swee Hong announced that it had swung back into the black with a net profit of $30.2 million in the last year versus a net loss of $10.2 million a year ago.

Also making a return to the actives list was NetLink NBN Trust. Units in the fibre optic cable owner climbed one cent or 1.24 per cent to 82 cents - the highest close since its July IPO - with 21.9 million units changing hands.

On Tuesday, DBS Group Research initiated coverage on NetLink with a 95 cents target price. UOB Kay Hian initiated coverage with a 93 cents cents target price on the same day.