US-China October talks lift market

Investor confidence continued to recover yesterday after China said it would hold trade talks with the US next month.

The improvement in relations between the two sides came a day after Hong Kong scrapped its much-maligned extradition Bill, which was in itself, a boon for market sentiment.

Singapore's Straits Times Index (STI) added 16.49 points or 0.5 per cent to finish at 3,147.06.

Elsewhere in the Asia-Pacific, Australia, China, Japan and South Korea ended higher.

On the other hand, Hong Kong's Hang Seng Index followed Wednesday's 3.9 per cent surge by closing flat, as investors took to profit-taking.

The territory's bourse operator had to suspend trading in its derivatives market yesterday afternoon and the after-hours sessions because of connectivity issues.

Malaysia was also flat.

AxiTrader market strategist Stephen Innes said: "News that the US and China will resume face-to-face trade talks in October was well-received by the market, amid an already risk-on tone. The market sentiment has brightened considerably as the seduction of chasing positive trade war headlines are proving far too irresistible for investors, who continue to wear trade-war emotions on their sleeve."

Mr Innes also said investors "continue to walk the thin line between expectations of central bank policy easing and a weakening economic environment".

In Singapore, trading volume clocked 738.13 million securities, 62 per cent of the daily average in the first seven months of 2019.

Total turnover came to $1.02 billion, 96 per cent of the January-to-July daily average.

Across the market, advancers pipped decliners 191 to 190. The blue-chip index had seven of the 30 counters in the red.

It was pretty much the same story among STI counters. Yangzijiang Shipbuilding, which advanced 2.5 cents or 2.7 per cent to end at 96.5 cents, kept its spot as the most active listing with 63.6 million shares changing hands.

The Chinese shipbuilder said on Wednesday after the market closed that it has inked new order contracts for five vessels.

The contract wins, analysts at Citi Research noted, "reaffirms our view that chairman Ren Yuanlin's leave of absence is unlikely to affect Yangzijiang's day-to-day operations and the ability to attract new orders".

Yangzijiang shares have remained volatile since news broke that the chairman of a charity foundation set up by Mr Ren was being investigated by the Chinese authorities. Mr Ren is on leave, assisting in the probe.

Citi Research said: "While we acknowledge that share price overhang and volatility is likely to persist, we await further clarity on the chairman's status. The recent order win replenishment is key to re-instilling investor confidence in the stock."

The banking trio finished higher. DBS Group Holdings added $0.09 or 0.4 per cent to $24.63.OCBC Bank was up $0.06 or 0.6 per cent at $10.77 and United Overseas Bank $0.16 or 0.6 per cent at $25.26.

Bourse operator Singapore Exchange continued to trend upwards, adding $0.15 or 1.8 per cent to $8.50 yesterday, the highest closing price in more than four years.

Among real estate investment trusts (Reits), Frasers Centrepoint Trust (FCT) edged up one cent or 0.3 per cent to $2.85.

FCT will be included in the FTSE EPRA/NAREIT Global Real Estate Index from Sept 23. The index tracks the performance of listed real-estate companies and Reits worldwide.

One trader said FCT's inclusion in the index will not only raise the profile of the Reit among fund managers, but will improve its trading liquidity.

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