Sep 03, 2014

    STI rises on good Europe vibes

    LOCAL shares rebounded yesterday on positive cues from European stocks, which advanced for a third straight session on speculation of possible stimulus from the European Central Bank (ECB).

    ECB president Mario Draghi has signalled that policymakers are ready to combat low inflation and to tackle concerns that the escalating crisis in the Ukraine could pull the European Union back into recession.

    The Straits Times Index gained 14.17 points to 3,328.30, with 1.6 billion shares worth $860.6 million changing hands.

    Leading the rebound were two gainers from the Jardine group of companies - Jardine Matheson and Jardine Strategic - as well as blue-chip heavyweights like SingTel and CapitaLand.

    Jardine Matheson gained 0.9 per cent or 52 US cents (65 Singapore cents) to US$60.55, while Jardine Strategic gained 1.2 per cent or 42 US cents to US$36.75.

    SingTel jumped 1.8 per cent or seven cents to $3.94, with 10.6 million shares changing hands, while CapitaLand rose 1.22 per cent or four cents to $3.32, on 9.34 million shares done.

    Oil exploration and production company Rex International Holding called for a trading halt yesterday, pending the release of an announcement.

    The Singapore Exchange (SGX) issued a "trade with caution" notice against thumb-drive firm Trek 2000 International, after the company said it could not explain why there was a "substantial increase" in its share price of 21.4 per cent between Thursday and Monday.

    Trek 2000's shares spiked to a 52-week high of 34 cents on Monday, drawing queries from the SGX that day. The company's shares rose 3.5 Singapore cents or 11.5 per cent on Monday with 1.5 million shares done.

    Meanwhile, chip testing and assembly player Stats ChipPAC slid for the second straight session, following news that Shenzhen-listed Tianshui Huatian Technology has decided to terminate its approach to buy the company.

    Among the top volume stocks, Stats ChipPAC plunged nearly 11 per cent or 7.5 cents to 62 cents, with 62.4 million shares changing hands.

    Shares of Foreland Fabrictech Holdings plunged 29 per cent or 0.5 cent to 1.2 cent yesterday. This comes after the textile supplier said it could not get sufficient evidence to justify a 275.3 million yuan settlement between its Fulian Knitting unit and customer Jiangxi Longdu for losses and damages incurred as a result of certain defective products.

    The settlement was based on advice from a legal adviser and an appraisal report issued by an accountant from China.

    In response to SGX queries last week, Foreland said its auditors could not get "sufficient appropriate audit evidence" to satisfy themselves on the competence, capabilities and objectivity of the legal adviser and the accountant.