STI rises 12.4 points in quiet trading

The Straits Times Index (STI) yesterday kicked off the week with a 12.4-point rise to 3,187.51, thanks mainly to gains in Jardine stocks.

Overall trading, however, was quiet with turnover amounting to 2.3 billion units worth $1.1 billion compared with Friday's $1.6 billion. Excluding warrants there were 273 rises versus 189 falls throughout.Brokers described the session as cautious, with Wall Street very much in mind.

The Dow futures at 5pm stood 19 points higher, suggesting a slightly firm opening for the US market. But European markets opened mostly in the red.

Jardine stocks that contributed the most to the STI's rise were Cycle & Carriage and Jardine Matheson - the latter's US$0.89 (S$1.24), or 1.4 per cent, rise to US$65.14 on volume of 238,400 made it the index's largest contributor with three points. Elsewhere within the index, shares of Global Logistic Properties (GLP) finished $0.01 down at $2.77 on volume of 6.3 million.

The company last week provided an update of a previously-announced strategic review, saying that the parties it is in discussions with have now started their due diligence.

In response, OCBC Investment Research said that while GLP's share price continues to hover near a two-year high, GLP has emphasised that there is no assurance any transaction will materialise from this strategic review.

"Again, we see the risk-reward in its shares as fairly balanced at current levels," said the broker as it maintained a "hold" with $2.87 fair value.

Also active was Alliance Mineral, which rebounded $0.06, or 18.8 per cent, to $0.38 on volume of 47.2 million. The counter had plunged on Friday after local broker Phillip Capital imposed trading curbs.

As for Wall Street, traders said they think players will wait and see if the rally of the past four months has been premature and over-optimistic, as US President Donald Trump has so far not delivered on the large tax cuts and spending increases he promised during his election campaign.

Because of this failure to deliver, DBS chief investment officer Lim Say Boon said he expects risk appetite to pull back in coming months.

"Nor should markets have been expecting anything quite so soon. Yet stock prices have moved ahead of reality.

"More significantly, Mr Trump has blown his first months in office politicking rather than building," said Mr Lim.

"But a new bear market in global equities is unlikely. Markets do not typically go into bear mode in the absence of recession or geopolitical shocks. We cannot rule out the latter but the former is highly unlikely."

The Singapore Exchange's investor education portal, My Gateway, said the information technology sector generated a capitalisation weighted total return of 10.9 per cent last month, taking its quarterly total return to 25.5 per cent.

"This was the strongest of the sector's moves both in the month of March, in addition to 1Q17...

"During March, Singapore's IT Sector was subject to institutional inflows amounting to $26.9 million. Within the sector, semiconductor play UMS Holdings and EMS company Venture Corporation saw the most institutional buying for the month."

This article appears in The Business Times today. For full listings of SGX prices, go to http://btd.sg/BTmkts