Punters prop up STI despite weak US data
WEAK home sales numbers out of the United States dragged down many bourses across the region, but a determined bout of bargain-hunting drove Singapore shares to a strong close.
The benchmark Straits Times Index climbed 25.92 points, or 0.8 per cent, to 3,283.93.
It was able to shrug off Wall Street's overnight losses. The fall was triggered by a report showing that sales of new homes in the US had plunged unexpectedly by 14.5 per cent last month from levels in the month before - a sign that the housing market there remains weak.
However, market analysts are still bullish about the world's largest economy and global stocks.
"While the US economy has had a subdued start to 2014, I believe the strength and duration of its resurgence will surprise investors," wrote Mr Dominic Rossi, Fidelity Worldwide Investment's chief investment officer for global equities, in a note on Wednesday.
"With the prospect of supportive liquidity conditions, I believe a return to the 'cult of equity' can support a multi-year bull market in stocks."
In Singapore, the spotlight was firmly on SMRT Corp, whose shares rose 18.5 per cent yesterday, closing 19 cents higher at $1.215.
Dealers said there is speculation that the train operator could be a target for privatisation, but the firm said in a statement after the market closed that it was not aware of any possible reason for the share price jump.
Meanwhile, Keppel Corp edged down four cents to $10.59.
CIMB yesterday released a note urging punters to stay invested in the rigbuilder, noting that its strategy in the Caspian Sea is paying off.
"We believe that by having two yards in Azerbaijan... Keppel will be ahead of its competitors in bids for any contracts in the Caspian region that require local content elements," wrote analyst Lim Siew Khee.
She noted that "other Asian yards might miss the opportunities" because they lack the presence or yard proximity.
Sheng Siong shares gained half a cent to 60 cents. The supermarket chain operator said yesterday that its net profit for the first quarter rose 19 per cent from levels a year ago to $12.5 million.
The Singapore Exchange noted in a report yesterday that Sheng Siong is among the three largest food retailers and wholesalers on the local bourse.
The other two are Dairy Farm International, whose shares fell six US cents to US$10.16, and BreadTalk Group, which saw its stock rise 13 cents to $1.345.
Old Chang Kee is the fourth food retailer on the Singapore bourse. Its shares slipped half a cent to 94.5 cents.