May 16, 2014

    STI just shy of new 2014 high

    SINGAPORE shares yesterday climbed to within touching distance of a fresh peak for the year, despite mostly negative leads from Wall Street and the rest of Asia.

    The Straits Times Index (STI) added 13.40 points, or 0.41 per cent, to 3,272.49. Some 1.6 billion shares worth $1.2 billion changed hands.

    Yesterday's gains took the benchmark index closer to its peak for this year of 3,283.93, reached on April 24.

    Overnight, Wall Street had ended weaker with the S&P 500 index down 0.5 per cent and the Dow Jones Industrial Average 0.6 per cent behind.

    "The psychological round figure of 1,900 (for the S&P 500) may have encouraged profit taking...the absence of market-moving data and earnings further stymied flows, with volumes falling below the three-month average," said CMC Markets analyst Desmond Chua.

    This bearish mood spread somewhat across Asia yesterday, with regional bourses finishing mixed. Tokyo was down 0.75 per cent as a stronger yen weighed on Japanese equities, while Shanghai retreated 1.12 per cent.

    But Hong Kong added 0.66 per cent and Australia advanced 0.26 per cent.

    Here, 17 of the 30 STI component stocks closed higher, with eight ending lower and five unchanged.

    Index heavyweight SingTel was in the spotlight yesterday, after it unveiled its fourth-quarter earnings in the morning, finishing a cent up at $3.85.

    The telco's net profit rose 4 per cent from a year earlier but came in shy of analysts' expectations, dampened by unfavourable exchange rates and a lacklustre performance from its group enterprise business.

    OCBC raised SingTel's target price from $3.74 to $4, noting: "As guidance is largely in line with our forecast, we opt to keep our estimates largely unchanged."

    SMRT Corporation continued to capture the investor limelight, surging another 6.5 cents to $1.335 on investor speculation that the Government will soon be making transport policy changes.

    A similar belief propelled ComfortDelGro up six cents to $2.27 - a fresh seven-year high.

    Thai Beverage gained 1.5 cents to 61 cents after unveiling better-than-expected first-quarter earnings.

    DBS upgraded the stock from "hold" to "buy" and raised its price target from 56 cents to 68 cents, owing to its higher earnings and expectations that margins are sustainable.

    The broker noted: "Its valuation now looks undemanding...coupled with the group's  market-dominant position and wide product portfolio in Thailand."