STI touches 3,300 points, then falls back
Flat day for stocks marked by rises in Keppel, SembMarine and City Developments
Singapore stocks finished unchanged yesterday, with the benchmark Straits Times Index (STI) up just 0.27 point, or 0.01 per cent, to 3,291.56.
This was after hitting a high of 3,300 points early in the morning, and falling to 3,280 points soon after. Losers outnumbered gainers 257 to 193, or about four down for every three up.
"The Straits Times Index is facing some selling pressure at the technical resistance level of 3,300," said CMC Markets Singapore market analyst Margaret Yang in a note yesterday morning. "Investors are also waiting for the earnings season to kick off this Wednesday for a clearer picture."
About 2.16 billion shares worth $1.05 billion in total changed hands, which worked out to an average unit price of $0.49 per share.
Top stocks by value traded were Singtel, Global Logistic Properties, City Developments, DBS and Sembcorp Marine.
US stocks had closed lower last Friday after a jobs report showed that non-farm employment declined in September, skewed by the effects of hurricanes.
Worth highlighting was how average weekly earnings rose 2.9 per cent year-on-year in September, fuelling talk of inflation finally coming back.
Headline inflation had also been higher in Asian economies such as China and India.
But calling it "mostly noise", Dr Frederic Neumann, HSBC's co-head of Asian Economics Research, said that core inflation (typically excluding volatile food and energy prices) is still remarkably steady across emerging Asia, reflecting subdued wage pressures and local demand.
In Asia, China stocks traded higher after returning from a long holiday. Banking stocks led gains.
On the Singapore bourse, the Jardine stable, excluding Hongkong Land, dragged down the STI.
Keppel Corp, Sembcorp Marine and Sembcorp Industries all rose, with SembMarine up 4.6 per cent to $1.815 and Keppel up one per cent to $6.75.
The positive sentiment on rigbuilding-related stocks came after SembMarine struck a deal last Friday to sell nine rigs for US$1.3 billion plus a market-based fee.
DBS analyst Ho Pei Hwa, in reiterating her "buy" calls on SembMarine and Keppel, said that though the price discount to original contract value was steeper than expected, it should improve in the next 12 to 18 months as oil prices recover and capital expenditures improve.
Property developer City Developments rose 15 Singapore cents, or 1.3 per cent, to $11.75.
This was after it announced a cash offer for the outstanding shares in London-listed hotel subsidiary Millennium & Copthorne Hotels (M&C) that it does not already own.
Analysts are also bullish on the firm after its record bid for the freehold Amber Park condominium last week increased its exposure to the Singapore property market, where some are now saying that prices have bottomed.
Last Friday, Maybank Kim Eng Research analyst Derrick Heng removed his revised net asset value (RNAV) discount for the firm, upping his target price to $13.60.
He also reduced his RNAV discounts to two other Singapore property market proxies, UOL and GuocoLand, which won tenders for land recently.
Finally, a number of Catalist-listed stocks dominated the top actives.
The most actively traded counter was Magnus Energy. Other actives included Rowsley and DISA.
This article appears in The Business Times today. For full listings of SGX prices, go to http://btd.sg/BTmkts