STI courts 2-year high as Greek fears fade

'WILLING TO TALK': Alexis Tsipras was sworn in as Greece's prime minister at the Presidential Palace in Athens on Monday.


    Jan 28, 2015

    STI courts 2-year high as Greek fears fade

    INVESTORS sent shares over the 3,400 mark yesterday, on the back of a regional rally underpinned by optimism that Greece will not leave the euro currency bloc.

    The benchmark Straits Times index closed at 3,412.20, up 13.68, with 1.8 billion shares worth $1.36 billion changing hands.

    "The Greek elections had the potential to unnerve the market," Nader Naeimi, head of dynamic asset allocation at AMP Capital Investors in Sydney, told Bloomberg. "It's quite encouraging that the new government and the European Union are willing to negotiate."

    Singapore remisier Alvin Yong added: "There's growing risk appetite among traders for equities as the Federal Open Market Committee (FOMC) is seen as not likely to raise interest rates before April."

    The FOMC, which issues its policy statement today, is expected to reiterate that global risks have not derailed the United States recovery or its rate-hike plans.

    The optimism has put the STI within striking distance of a two-year high of 3,454.37 reached on May 22, 2013, a month before the US Federal Reserve said it would start tapering its QE (quantitative easing) programme, Phillip Futures investment analyst Howie Lee said.

    "If there aren't any changes in the US monetary policy, then we are likely to test this level before Chinese New Year," he added.

    Japan climbed 1.7 per cent after the yen slid 0.6 per cent against the greenback yesterday. South Korea added 0.9 per cent, while Taiwan rose 0.5 per cent.

    Penny plays dominated local trade yesterday, with Pacific Andes, the most active stock by volume, up more than 12 per cent or 0.6 cent to 5.5 cents, with 131.5 million shares changing hands.

    Catalist-listed Sincap Group jumped 10 per cent or one cent to 10.6 cents, with 51.5 million shares traded. The China-based coal and aluminium trader said on Monday it will offer up to 351 million new shares through a placement exercise, at 10 cents each, to raise net proceeds of about $34 million.

    SGX dipped 0.8 per cent or six cents to $7.78, with 1.75 million shares traded. The stock market operator went ex-dividend yesterday, with a distribution of four cents a unit. That means investors who bought shares after yesterday are not entitled to participate in the dividend payable on Feb 5.