singapore stocks close the week on a bullish note 1552322015

Singapore stocks remained in a firm bull grip on Friday, closing the week with a sharp gain that brought the benchmark Straits Times Index to a close within kissing distance of the technically significant and psychologically important level of 3,000.

The STI gained over 7 per cent during the week as investors charged in to scoop up the biggest and most liquid blue chips at bargain prices after risk returned to fashion once the Fed rate hike fears dissipated.  

Indices

The Straits Times Index (STI) ended 51.47 points or 1.75 per cent higher at 2,998.5, taking the year-to-date performance to -10.90 per cent.

The FTSE ST Mid Cap Index gained 1.32 per cent, while the FTSE ST Small Cap Index rose 0.93 per cent.

The Singapore Exchange traded a volume of 1,866.9 million shares valued at SG$1,449.1 million. Gainers outnumbered losers by 326/102.

Amongst the FTSE ST sectors, the top gaining sectors included basic materials (+3.97 per cent), oil and gas (+3.54 per cent), Catalist Index (+2.24 per cent), telecommunications (+1.98 per cent), consumer goods (+1.80 per cent) and real estate holding and development (+1.71 per cent). Healthcare (-0.76 per cent) and maritime (-0.31 per cent) were the only two losing sectors on Friday.

Stocks

Shares in Singapore Airlines Ltd. (SGX:C6L) were down 0.85 per cent to SG$10.56. An aircraft belonging to the airline collapsed on Changi Airport on Sunday morning after its nose gear unexpectedly contracted, Channel News Asia reported. However, there were no passengers or crew on board the aircraft, except an engineer, who was unhurt. Singapore Airlines Ltd. (SGX:C6L) was the top loser on the Straits Times Index on Friday.

Singapore Exchange Limited (SGX:S68) said its security markets turnover jumped 7 per cent year-on-year in September to SG$22.5 billion, while the volume of derivatives traded rose 33 per cent year-on-year to 14.1 million.

Shares in real estate development company TEE Land Ltd (SGX:S9B) jumped 5.53 per cent to SG$0.210. The company’s net profit during the first quarter ended August 31 plunged 69.2 per cent year-on-year to SG$885,000, while revenue fell 47.9 per cent to SG$3.352 million. The company attributed the performance to a challenging property market, according to the Straits Times.

Nightclub operator LifeBrandz Ltd (SGX:L20) said Friday that it intended to transfer its listing from the mainboard of the Singapore Exchange to the Catalist board, though it cautioned there was no certainty that the transfer would be approved by shareholders and the Singapore Exchange.

Noble Group Limited (SGX:N21) rebounded 16.05 per cent to SG$0.470 after the company appear to be changing its focus and business strategy to achieve its profits of delivering immediate results, according to the Straits Times. Analysts also said the jump could be due to the global rise in commodity prices over the past week. "The company seems to be changing its focus," observed Carey Wong, analyst at OCBC Investment Research. "It's trimming some of the businesses it feels will not do well in the next few years, such as copper.” Noble was the top gainer on the Straits Times Index in Friday’s trading.

Economic news

The Monetary Authority of Singapore (MAS) will release its October monetary policy statement on Wednesday (October 14). The majority of economists from a Reuters poll expect Singapore’s central bank to take measures to weaken the Singapore dollar either by either recalibrating its nominal effective exchange rate or by reducing the slope of the band within which the currency is maintained.

On the same day, Singapore’s Ministry of Trade and Industry will release its advance estimates for economic growth during the third quarter. Business leaders expect growth figures to be down and their recent comments reveal glum sentiments. "China is slowing down, and it is our largest trading partner,” said Victor Tay, chief operating officer of the Singapore Business Federation. “The US recovery is also not strong, according to the latest jobs report, and Europe is also lackluster.”

"When the world sneezes, we catch a cold," said Singapore International Chamber of Commerce chief executive Victor Mills, as quoted by the Straits Times.

OPEC secretary general Abdullah el-Badri said Sunday that the oil market would be “more balanced” next year due to increasing global demand and an expected contraction in non-OPEC crude production. Mr. Badri said the 60 per cent decline in crude prices since June 2014 was not supported by market fundamentals, and that investments of USSG$10 trillion were needed between now and 2040, by which time global demand for oil could jump to 110 million barrels per day from the current 93 million barrels per day.

US Federal Reserve Vice Chairman Stanley Fischer said the central bank could still raise interest rates this year, but that is “an expectation, not a commitment.” Fischer observed on the sidelines of an IMF meeting in Peru: “Both the timing of the first rate increase and any subsequent adjustments to the federal funds rate target will depend critically on future developments in the economy.” 

On Wall Street Friday, stocks closed higher after investors gained confidence in the fact that the US Fed is likely to postpone its much-feared rate hike to the next year. The week therefore closed on a positive note for US stocks. The Dow Jones advanced 33.74 points (0.20 per cent) to 17,084.49 and the broad-based S&P 500 added 1.46 (0.07 per cent) at 2,014.89. The Nasdaq Composite Index climbed 19.68 (0.41 per cent) to 4,830.47, lifted by a 2.4 per cent gain in Apple.