STI bucks regional downturn
THE local market outshone others in the region yesterday, thanks in part to a surge by United Overseas Bank (UOB) shares.
UOB gained 42 cents or 1.85 per cent to $23.08, a move that accounted for 5.89 points of the Straits Times Index's 9.24-point increase to 3,273.15.
Its banking rivals were also ahead, but by less. DBS Group Holdings increased 13 cents or 0.77 per cent to $17.02, while OCBC Bank was up by one cent or 0.1 per cent to $9.49.
DBS and OCBC continue to trade within a narrow range, but UOB has done better this year due to its limited exposure to China, where growth is slowing. There are also fears over the mainland's "shadow banking" sector.
The STI's modest rise occurred amid a general downturn in the region, ahead of a policy meeting of the European Central Bank and unemployment figures from the United States, both due out after regional markets closed yesterday.
US labour market data is normally released on the first Friday on each month, but it is one day earlier this time due to the 4th of July holiday today.
Hong Kong's Hang Seng Index fell 0.08 per cent and the Nikkei 225 in Tokyo slipped 0.14 per cent.
Apart from the banks, other local movers included rigbuilder Keppel Corp, which rose one cent or 0.09 per cent to $10.75.
The firm announced yesterday morning that a previously announced conditional contract had become effective after certain conditions were met.
The US$735 million (S$916 million) deal is with a subsidiary of Golar LNG to convert an LNG carrier into a floating liquefaction vessel. Keppel said the conversion works will be the first of its type in the world.
"Keppel is leading the pack with many firsts," said DBS Group Research. It cited this conversion project as well as an innovative drillship design and "potentially an arctic rig that would be able to perform drilling throughout the year".
"The contract strengthens Keppel's lead in complex offshore conversion projects and research-and-development capabilities to offer innovative solutions."
DBS has a "buy" call and target price of $12.60 on Keppel.
OCBC Investment Research sparked some excitement in the property space with a note saying that there is a lot of value in the western end of Orchard Road that can be unlocked.
Owners in that area rose sharply, with Hotel Properties up 38 cents or 9.45 per cent to $4.40, Wheelock Properties ahead by 12.5 cents or 7 per cent to $1.91, Hong Fok Corp rising 2.5 cents or 2.3 per cent to $1.10 and Bonvests Holdings increasing two cents or 1.4 per cent to $1.44.
THE STRAITS TIMES