Good US vibes rub off on Asia
SINGAPORE stocks yesterday touched their highest level in more than a year, even though trading was relatively quiet.
The benchmark Straits Times Index (STI) rose 5.77 points or 0.17 per cent to 3,305.2 - a level not seen since May 31 last year.
Good news emerged from the United States on Friday, with positive employment data lifting the two main Wall Street indices, the Dow Jones Industrial Average and S&P 500, to record highs.
"The all-round improvement in the jobs sector attracted flows back into US bourses, as investors who had refused to partake at frothy levels would rather be late for the party, than miss it entirely," said CMC Markets analyst Desmond Chua.
This helped boost Asian markets yesterday, although the gains were muted. Tokyo's Nikkei 225 rose 0.3 per cent while the Hang Seng Index in Hong Kong did better, with a 0.7 per cent increase.
Singapore followed regional bourses into the black, but volumes were modest at 2.31 billion shares worth $882 million, lower than the past year's daily average of 2.74 billion shares worth $1.17 billion.
More stock trading sessions have seen limited price movements of late. The recent strong rises in stock markets - both here and overseas - have left investors wondering if bourses still have the energy to climb higher.
Of the 26 stock trading sessions here since the start of last month, the STI has moved by fewer than 10 points on 16 occasions. A movement of 10 points is considered small for a day's trading.
Since the start of last month, the STI has risen by 40.49 points or 1.2 per cent.
Among local shares yesterday, CapitaLand rose three cents or 0.9 per cent to $3.23.
The developer said on Sunday that its stake in CapitaMalls Asia (CMA) had crossed the requisite threshold to compulsorily acquire the remaining CMA shares that it does not own.
OCBC Investment Research said in a note that the privatisation of CMA will improve CapitaLand's earnings and return on equity. It kept its "buy" call and fair value estimate of $3.79 on CapitaLand.
Singapore Post jumped 5.5 cents or 3.4 per cent to $1.68. The counter has been in the spotlight since it announced late last month that it would tie up with China's Alibaba, the world's largest e-commerce company.
Alibaba is buying a 10.35 per cent stake in SingPost, and the two companies have also signed an agreement to develop a joint venture related to international e-commerce logistics.