Positive start to week for STI

Singapore equities took their cue from last Friday's encouraging performance on Wall Street to get the week off to a positive start, but worries remain over the global growth outlook as well as US-China trade tension in the lead-up to this week's talks.

The Straits Times Index (STI) opened 0.2 per cent higher and extended those gains to close at 3,099.48, adding 21.12 points or 0.7 per cent.

Other key Asia-Pacific markets that were open mostly ended higher, with Australia, Japan, Malaysia and South Korea posting gains.

Markets in China and Hong Kong will resume trading today.

Even though last Friday's US jobs report, which showed unemployment in the US economy fell to a 50-year low of 3.5 per cent, eased recession fears, US growth has definitely eased, with expectations that the Federal Reserve will make two more rate cuts this year.

The Monetary Authority of Singapore (MAS) announced yesterday it will be delivering its monetary policy statement on Oct 14, the day the Republic is expected to release preliminary gross domestic product figures for the third quarter.

Consensus estimates point to the MAS lowering its policy slope by 50 basis points from the current 1 per cent appreciation path. If indeed the case, this will come after two moves to steepen the curve last year.

With China, Hong Kong and a number of Australian states on holiday, it was a low-liquidity session in Singapore.

Trading volume stood at 582.11 million securities, just under half of the daily average in the first eight months of this year. Meanwhile, total turnover clocked in at $705.51 million, two-thirds the January-to-August daily average.

ADVANCERS

Across the market, advancers trumped decliners 202 to 133. Just three of the blue-chip index's 30 counters ended in the red.

Golden Agri-Resources was the STI's most active counter with 31.6 million shares traded.

The counter dipped one cent or 4.5 per cent to close at 21 cents.

In line with the generally pro-risk sentiment of the day, the banking trio were in the black.

DBS Group Holdings added 13 cents or 0.5 per cent to $24.68, OCBC Bank gained six cents or 0.6 per cent to $10.68 while United Overseas Bank finished at $25.32, up 15 cents or 0.6 per cent.

Among the day's big gainers was conglomerate Keppel Corp, which added 10 cents or 1.7 per cent to close at $5.91 after its offshore and marine unit reached a long-awaited settlement agreement with Sete Brasil over six uncompleted oil drilling rigs.

Among the real estate investment trusts, Mapletree Industrial Trust (MIT) edged up one cent or 0.4 per cent at $2.44.

Citi research's analyst Brandon Lee noted that with HP, which contributes to 5 per cent of MIT's income, announcing global job cuts, the near-term impact of the tech firm's decision "could be mitigated by its long-lease without break clause, 10 months of security deposits and Singapore being its Asia-Pacific/Japan headquarters".

"We see any negative knee-jerk share-price reaction as enhanced opportunities to accumulate the stock," he added.

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