the sgx posts solid gains amid higher volumes 1725092015

Singapore’s Straits Times Index surged back above the 3,000 mark on Wednesday, led by gains in the technology and healthcare sectors, and the sharp run-up on the Hong Kong and Shanghai exchanges, which closed higher by 4.31 per cent and 2.15 per cent respectively.

The rally was supported by significantly higher volume and markedly positive market breadth.

Indices and Sectors

The Straits Times Index (STI) ended 40.92 points or 1.36 per cent higher at 3,040.48, taking the year-to-date performance to -9.65 per cent.

The FTSE ST Mid Cap Index gained 1.15 per cent, while the FTSE ST Small Cap Index rose 0.62 per cent.

The Singapore Exchange traded a volume of 1,831.1 million shares valued at SG$1,031.9 million. Gainers outnumbered losers by 255/138.

The technology sector (+6.83 per cent) was the top gainer for the second day in a row. The other gaining sectors included health care (+6.52 per cent), real estate holding and development (+2.41 per cent), basic materials (+2.21 per cent) industrials (+2.13 per cent) and China Top Index (+2.05 per cent). Utilities (-0.17 per cent) was the only losing sector on Wednesday.

Stocks

CapitaLand Limited (SGX:C31) has pulled out of negotiations for the acquisition of Asia Square Tower One, an office building transaction that would have been Singapore’s largest ever, reports Channel News Asia. According to Bloomberg, the office tower was valued at over SG$3.5 billion. Net profit during the third quarter ended September 30 at CapitaLand surged 48.3 per cent to SG$192.7 million, while revenue jumped 17.1 per cent to SG$1.076 billion, led by higher contributions from projects in China, as well as better rental returns from malls and serviced residences.

According to AsiaOne, Ms Florence Suryawana, a Singapore businesswoman, has sued DBS Bank [DBS Group Holdings Ltd (SGX:D05)] for SG$8.4 million, being the amount of money she lost on forex trades allegedly because the bank misled her into buying options to hedge her investments. The bank denied responsibility, saying that she was a sophisticated and experienced investor who used her own judgement when she bought the options.

Biosensors International Group Ltd (SGX:B20) vaulted nearly 20 per cent to SG$0.815 on a volume of 23 million shares. According to the Straits Times, Citic Private Equity Funds Management Co, a private equity arm of Citic Group Corp, has agreed to buy all the shares of Biosensors that it does not already own for SG$0.84 per share. Citic currently controls nearly 20 per cent of the company. The deal could be valued as much as SG$1.1 billion.

Rotary Engineering Limited (SGX:R07) fell 2.56 per cent to SG$0.380. The oil and gas infrastructure services firm said that net profit during the third quarter ended September 30 plunged 42 per cent year-on-year to SG$6.3 million, while revenue crashed 65 per cent to SG$60.3 million due to completion of some major projects.

Jardine Cycle & Carriage Ltd (SGX:C07) was up 1.08 per cent to SG$33.56. Net profit during the third quarter ended September 30 slumped 15 per cent year-on-year to US$182.2 million (SG$255.1 million), while revenue fell 20 per cent to US$3.7 billion. The company attributed the downbeat performance to reduced domestic consumption, competition in the car sector, lower commodity prices and deterioration in the credit quality of its corporate clients, the Straits Times said.

Ground handling firm Sats Ltd (SGX:S58) lost 0.52 per cent to end at SG$3.80. The company said net profits during the second quarter ended September 30 jumped 27 per cent to SG$59.7 million, despite a fall in revenues by 4.4 per cent year-on-year to SG$422.7 million. According to the Straits Times, profits at the company were boosted by higher passenger volume at Changi airport, lower staffing costs, cheaper materials and better earnings from associated companies.

United Food Holdings Limited (SGX:AZR) has warned of a likely loss in its third-quarter due to a temporary suspension of soya bean processing payments and cancellations of soya bean purchase contracts, the Straits Times said.

Net profit during the third quarter at Challenger Technologies Limited (SGX:573) fell 4 per cent year-on-year to SG$3.5 million on the back of a change in its product sales mix, according to the Straits Times.

Shares in water treatment firm Hyflux Ltd. (SGX:600) gained 1.50 per cent to SG$0.675. For the third quarter ended September 30, the company’s earnings plunged 43 per cent year-on-year to SG$6.44 million, even though revenues spiked 32 per cent to SG$133.52 million. "With many countries scaling back on infrastructure projects as a result of the depressed oil prices, Hyflux is cautious about its business outlook in the near term. Nevertheless, the group has a strong order book and will continue to strengthen its capabilities in anticipation of the longer-term growth opportunities," Hyflux said in a statement, according to the Straits Times.

Haw Par Corporation Ltd (SGX:H02), which makes the Tiger Balm range of health products, rose 0.48 per cent to SG$8.42. For the third quarter ended September 30 the company’s profits surged 31.1 per cent to SG$34.9 million, boosted by higher profits on its ointments range and investment gains, the Business Times reported.

Rickmers Maritime (SGX:B1ZU) has suspended distributions to unit holders in a bid to conserve cash pending an improvement in conditions in the charter market.

Economic news

Chinese and Hong Kong shares were initially boosted on Wednesday by an erroneous report out of the People’s Bank of China that gave the impression the Shenzen-Hong Kong Stock Connect trading link would be implemented within the year. The report was later denied by the Hong Kong exchange and the Chinese central bank. Stocks nevertheless ended sharply higher as investors digested overnight news from Beijing that said the Chinese government was targeting a "medium-high" growth of at least 6.5 per cent in its five-year economic plan, and was determined to liberalise its capital markets.

US Fed Chair Janet Yellen said Wednesday night that an interest rate hike in December remained well within the realm of possibility.

The Nikkei Singapore Purchasing Managers' Index (PMI), which serves as a barometer for business activity in the island-republic, fell to 50.2 in October, down from a seven-month high of 51.4 in September, according to the Straits Times. The decline was attributed to a drop in employment and a fall in new business orders.

On Wall Street Wednesday, stocks ended lower after Janet Yellen’s comments on the likelihood of a December interest rate hike, as well as a downtrend in energy stocks following a decline in crude oil prices, Reuters said. The Dow Jones Industrial Average fell 50.57 points, or 0.28 percent, to 17,867.58, the S&P 500 lost 7.48 points, or 0.35 percent, to 2,102.31 and the Nasdaq Composite dropped 2.65 points, or 0.05 percent, to 5,142.48.