Jun 24, 2016

    Flat trading as investors await Brexit poll results

    SINGAPORE shares eked out a small gain yesterday in line with most other markets in Asia.

    The benchmark Straits Times Index (STI) climbed just 7.72 points, or 0.28 per cent, to 2,793.85 in thin trade, as traders kept closely to the sidelines ahead of today's Brexit vote result.

    "The trading desk has been quiet. It seems investors are just watching to see what happens next (with Britain) and that has kept market sentiment very cautious," CMC Markets Singapore market analyst Margaret Yang told The Straits Times.

    Britain's referendum has been the key focus for investors around the world in recent weeks, with increasing fears that a Brexit outcome could roil the global economy and financial markets.

    Wall Street slipped 0.27 per cent overnight as the latest opinion polls in Britain were too close to call.

    In Asia, Tokyo rose 1.07 per cent as the yen weakened. Hong Kong put on 0.35 per cent while Shanghai eased 0.47 per cent, weighed down in part by worries over China's economy and the risk of a weakening yuan.

    The gains in the STI were led in part by telco Singtel, which rallied two cents or 0.5 per cent to $3.87, and palm oil giant Golden Agri-Resources, up half a cent or 1.4 per cent to 35.5 cents.

    Global Logistic Properties also did well, rising two cents or 1.1 per cent to $1.82. An OCBC Investment Research report noted the group has carried out a series of share buybacks, which now amount to about 39.7 million shares bought for $72 million since its full-year results on May 19.

    "Given the group's strong balance sheet, there is significant capital to deploy and we believe that these share buybacks are accretive to shareholders at currently undervalued prices," it said, maintaining a "buy" call on the stock.

    The local lenders were a mixed bag, with OCBC Bank advancing five cents or 0.6 per cent to $8.58 and United Overseas Bank up nine cents or 0.5 per cent to $18.27.

    DBS Group Holdings, on the other hand, lost five cents or 0.3 per cent to $15.94.

    The other laggards were mostly property plays. CapitaLand Commercial Trust sank 2.5 cents or 1.8 per cent to $1.395, City Developments dipped six cents or 0.7 per cent to $8.69 while Ascendas Reit pared one cent or 0.4 per cent to $2.32.

    Alliance Minerals Assets was the day's most hotly traded stock, jumping 1.2 cents or 17.1 per cent to 8.2 cents on 72.9 million shares done.

    Other actives included HTL International and Annica Holdings.

    Total trade across the bourse came up to a lacklustre 752.9 million units worth $690.5 million.

    "The Brexit issue has drawn a lot of eyeballs these days," said CMC Markets' Ms Yang.

    "But after everything has settled down, market attention will again go back to the fundamentals," she added, citing lingering concerns over the global economy and central banks' policies.