Apr 23, 2015

    S'pore bourse falls behind high-flying N. Asian peers

    SHARES of commodity trader Noble Group and Singapore Exchange (SGX) stole the limelight yesterday, while the broader market stepped slightly into negative territory ahead of the March-quarter earnings reporting season.

    Regionally, the hot action was in the markets of North Asia, as ebullient buying pushed Tokyo's Nikkei index to a 15-year high and China's stocks to a seven-year peak. Hong Kong shares, which have been tracking mainland markets, closed 0.3 per cent higher.

    The Straits Times Index (STI) ended 12.37 points or 0.35 per cent lower at 3,496.24.

    Volume totalled 1.77 billion shares worth $1.11 billion, down from Tuesday's 2.03 billion valued at $1.15 billion.

    Markets in Japan rose as investors chased up stocks they saw as undervalued in a liquidity-fuelled frenzy, while those in China gained further amid expectations of further monetary stimulus to support the weakening economy. China investors were also encouraged by a commentary in the People's Daily newspaper that the bull market "has just begun", and that there was no bubble.

    Singapore decoupled from these markets yesterday, with focus on a select band of stocks.

    Noble shares rose one cent or 1.15 per cent to 88 cents. The company promised to be more transparent, starting with greater disclosure in its first-quarter results slated for release on May 7.

    The company's stock has been pressured in recent months by allegations of improper accounting.

    "It is encouraging that Noble has come out this morning, agreeing to address the transparency needs of public shareholders," said CMC Markets analyst Nicholas Teo.

    SGX shares jumped 22 cents or 2.65 per cent to end at $8.52, as investors positioned themselves ahead of its third-quarterly results released yesterday after the market closed.

    The STI last week hit a seven-year high, driven partly by a penny-stock surge that has benefited SGX's trading volumes.

    Singtel kept meandering lower, losing three cents to $4.32. It is seeking to delist from the Australian Securities Exchange due to low trading volume, liquidity and market demand.

    Perennial Real Estate Holdings shares, which have been moving higher in the past week, fell three cents to $1.105, or 2.64 per cent.

    The company said on Tuesday that it was making its foray into the Malaysian property market by partnering giant IJM Land for a RM3 billion (S$1.1 billion) project in Penang.

    In its research note, CIMB said the project could add two cents to Perennial's revalued net asset value (RNAV) to $2.14. CIMB is maintaining its "add" call for the stock, judging its target price at $1.39, based on a 35 per cent discount to RNAV.