Regional markets up due to US jobs data
SINGAPORE rallied along with other key Asian markets yesterday, after strong jobs data in the United States over the weekend gave investors more clarity over interest rates and the economic outlook.
The benchmark Straits Times Index (STI) rose 21.87 points or 0.76 per cent to 2,900.92, reflecting gains in other major markets in the region.
Shanghai was up 0.34 per cent, and Tokyo put on 0.99 per cent, Kuala Lumpur rose 0.25 per cent and Jakarta closed up 0.29 per cent. But Hong Kong pared 0.15 per cent after a volatile session.
The regional gains yesterday were expected after the cue from Wall Street where Dow Jones Industrial Average rose 2.12 per cent on Friday, its biggest jump in three months.
This followed the news that the US non-farm payrolls grew more than expected last month, further confirming that the US Federal Reserve is ready to hike rates this month and to finally end market jitters.
But investors in Asia will also be keeping their eyes on China this week, when the world's second largest economy releases new data on its industrial production and retail sales. Market watchers such as Barclays senior economist Leong Wai Ho are not expecting great news.
"There are two different stories - while the US looks to be a growth driver, I believe this week we will continue to see that persistent softness in the Chinese economy, and we are calling for a 7 per cent year-on-year drop for November exports," Mr Leong told The Straits Times.
"The regional equities will not see any firm rebound towards the year end as a result. We will not see a collapse, but sentiments will remain subdued."
Reflecting that cautious stance, trading volumes here were slow, with only 875.7 million shares worth $696.8 million changing hands.
Still, there was enough lift to push 22 counters on the STI higher, with Jardine Cycle & Carriage gaining the most among the blue chips, up $1.15 or 3.27 per cent to $36.35. The company was issued a "trade with caution" warning by the Singapore Exchange on Thursday over a similar surge that it could not explain.
But Noble Group, another blue chip firm with exposure to energy prices, was the top loser on STI, falling one cent or 2.44 per cent to 40 cents.