STI gains 0.3% after Wall Street climbs
Almost all other Asian bourses close firmer, buoyed by a corporate-earnings-led rally in the US markets
The Singapore bourse stood on positive territory yesterday alongside major regional peers buoyed by a corporate-earnings-led rally in the US markets and the absence of any key market-moving news.
The key Straits Times Index climbed 9.21 points or 0.3 per cent to finish the day at 3,343.88 with some 1.8 billion shares worth $1.1 billion traded.
Almost all other Asian bourses closed firmer, except for Japan which bucked the trend with the Nikkei 225 down half a per cent, ending a rip-roaring 16-day winning streak.
Hong Kong's Hang Seng added half a per cent, China's Shanghai Composite was up 0.3 per cent, while South Korea's Kospi inched up by 0.1 per cent to record a fresh record high for a fourth straight session.
Closer to Singapore, Malaysia's KLCI rose 0.2 per cent.
There appears to be very little stopping the bulls in the US markets with its key stock indices returning to gains on Tuesday overnight, spurred by strong corporate earnings from heavyweights Caterpillar and 3M that lifted confidence over the global outlook.
The Standard & Poor's 500 index gained 0.2 per cent, the Dow Jones industrial average jumped 0.7 per cent while the Nasdaq composite climbed 0.2 per cent.
"Asset markets (in the US) are buoyant, ignoring domestic political noise and a plethora of outstanding geopolitical flashpoints," said DBS Group Research, which expects US growth to continue.
Oil prices are also riding an uptrend and the rally could continue, said CMC Markets Singapore analyst Margaret Yan Yang, if the Organization of the Petroleum Exporting Countries confirms that it will extend production cuts next month.
Even so, many analysts have warned investors to remain cautious as they expect a correction around the corner.
The markets are also bracing for the US Fed chair pick which is expected to happen soon.
"With the latest inclusion of Republican Senate leaders in the discussion for the next Fed chair, we have certainly seen markets responding in kind.
"The emergence of the perceivably bullish economist John Taylor in the discussion had long-term yields and the US dollar on the rise.
"While confirmation from the Senate would be a necessary step in the process, the selection ultimately lies with the president, as with the appointment of the other open positions on the Fed board. Reactions are still expected with the announcement prior to Nov 3," said IG market strategist Jingyi Pan.
On the home front, gainers outpaced losers with 245 counters up and 175 down.
Singapore's big three banks fuelled the gains with DBS rising 30 Singapore cents or 1.4 per cent to $22.20. UOB added 35 Singapore cents or 1.4 per cent to $24.60, while OCBC rose nine Singapore cents or 0.8 per cent to $11.55.
Hong Leong Asia, which jumped 15 Singapore cents or 14 per cent to $1.21, drew a trading activity query from the Singapore Exchange yesterday to explain its recent unusual price movements.
Mapletree Industrial Trust gained one Singapore cent or 0.5 per cent to $1.97. The real estate investment trust has priced an upsized $155.7 million placement of units at $1.90 per new unit.
Keppel Corp rose 10 Singapore cents or 1.4 per cent to $7.45. It announced that the preliminary prospectus for the proposed initial public offering (IPO) of units in Keppel-KBS US Reit on SGX has been lodged.
Jointly sponsored by Keppel Capital and KBS Pacific Advisors, Keppel-KBS US Reit is issuing 262.77 million units at 88 US cents apiece in the IPO.
This article appears in The Business Times today. For full listings of SGX prices, go to http://btd.sg/BTmkts