Mar 04, 2015

    Jardine, commodity stocks take STI higher

    SELECTED buying of big-name commodity stocks and interest in the Jardine group of companies helped to lift the stock market yesterday.

    The Straits Times Index (STI) rose 18.2 points or 0.5 per cent to 3,422.1.

    The benchmark index opened higher and never looked back, gaining as much as 27 points to hit an intra-day high of 3,430.8.

    Turnover came in at 1.3 billion shares worth $1.2 billion, in line with volumes in recent weeks.

    The positive showing by blue chips, with 18 stocks ending higher, nine lower and three unchanged, did not spill over to the broader market, with losers outnumbering gainers by a count of 238 to 195.

    CMC Markets analyst Nicholas Teo said the buying was dominated by commodity plays such as Noble, Golden Agri-Resources and Wilmar, as well as Jardine Matheson and Jardine Strategic.

    The five stocks contributed to a 14.2-point increase in the STI, or 78 per cent of the day's rise.

    "People are not buying the commodity complex because there is a fundamental shift in demand, it could be a case of traders taking short-term positions after their stock prices were hammered down recently."

    Another trigger for the interest in commodity stocks might have been Australia's central bank keeping interest rates unchanged, defying expectations of a rate cut, added Mr Teo.

    The move supported the commodity-linked Australian dollar against the United States dollar.

    Golden Agri was the top volume counter, up 1.5 cents to 41.5 cents with 129.1 million shares changing hands.

    Battered stock Noble, which has been combating allegations of creative accounting, rose after three previous sessions of losses, up 6.5 cents to $1.01.

    The counter was also the second-most traded, with close to 65 million shares changing hands.

    Both Golden Agri and Noble also reported that key shareholders - Silchester International Investors for Golden Agri and Noble Holdings for Noble - had upped their stakes.

    But another substantial Noble shareholder, Invesco, reduced its holdings to below 5 per cent.

    Wilmar gained five cents to $3.30.

    Topping the gainers list was Jardine Matheson, which rose US$1.45 to US$65.99, followed by Jardine Strategic, which added 84 US cents to US$35.84, as expectations ran high ahead of their earnings announcements.

    Laggards on the STI include Jardine C&C, which dropped 42 cents to $43, telco Singtel, down six cents to $4.18, and Singapore Airlines, which lost six cents to $12.