Jan 03, 2014

    Jardine stocks help STI extend winning streak

    THE first trading day of the year got off to a festive start on the local bourse, but it was hardly confetti and crackers by the end of the session.

    The Straits Times Index (STI) rose more than 20 points at the start. But the market benchmark gave up most of those gains to finish 7.22 points, or 0.23 per cent, higher at 3,174.65. Still, that was its ninth straight day of gains.

    Elsewhere, major Asian bourses were mixed, with Hong Kong's Hang Seng Index closing 0.14 per cent up and China's Shanghai Composite retreating 0.3 per cent. Australia's ASX 200 gained 0.3 per cent while South Korea's Kospi fell 2.2 per cent. Japan's stock markets were closed for the New Year holiday.

    While a record-breaking close on Wall Street last year could have driven bigger gains, the positive sentiment was squelched somewhat by weak manufacturing data out of China.

    On the local bourse, turnover stood at 4.31 billion shares worth $789.5 million. The Jardine stocks led the gainers, adding more than eight index points to the STI. Jardine Matheson Holdings jumped US$1.53 (S$1.94) or 3 per cent to US$53.84, while Jardine Strategic Holdings rose 84 US cents or 2.6 per cent to US$32.84.

    Other big gainers included Golden Agri-Resources, up 0.5 cent or nearly 1 per cent at 55 cents, and Hongkong Land Holdings, which rose three US cents or 0.5 per cent to US$5.93.

    Trading in penny stocks took centre stage. Most active was Hankore Environment Tech Group, with 961 million shares done. The stock gained 0.9 cent, or 8 per cent, to 11.7 cents.

    GSH Corp was the second-most active with 382 million shares traded. It gained 0.6 cent, or 7.4 per cent, to 8.7 cents. The firm, together with another investment vehicle of "popiah king" Sam Goi, said it plans to invest RM700 million (S$270 million) for a 77.5 per cent stake in The Sutera Harbour Group.

    Some analysts are upbeat about the local bourse's prospects this year. In a strategy report, OSK DMG Research said conditions are ripe for the market to outperform regional peers, given reasonable valuations and an expected flight to safety and stability this year.

    While blue chips are expected to deliver decent returns, the research house expects investor interest in small-cap stocks, particularly those in the construction sector and S-chips, to pick up.

    Still, a bumpy road lies ahead. Flash estimates showed that, while Singapore's economy expanded by 4.4 per cent in the final quarter from the same period a year ago, month-on-month growth slowed.