You are here
Singapore shares end higher in line with rises in China, HK stocks, Dow futures
A 250-POINT jump in Dow futures and sizeable gains in China and Hong Kong stocks on Tuesday helped the Straits Times Index (STI) avoid a sixth loss in seven sessions on Tuesday with a 32.91 points rise to 2,885.32. Volume was a low 1.2 billion units worth S$1 billion and excluding warrants there were 245 rises versus 151 falls.
Except for a 28 points short-covering bounce on Thursday last week, the index had lost 104 points since Aug 31 on concerns over a plunging China market, the impact of this on the country's economy and the consequences for global growth.
The STI's Monday rebound was led by the three local banks whose rises accounted for about half the final gain. Also helping push the index up were Hongkong Land and Singapore Exchange.
Despite the index's rise, brokers were in no rush to declare the worst over as it was most likely thanks to short covering ahead of an expected rally on Wall Street.
"This is the new normal for the Singapore bourse, low volume and high volatility," said one.
Among the banks, DBS finished S$0.26 or 1.5 per cent higher at S$17.70 on a volume of seven million shares traded.
HSBC Global Research in a Sept 8 "buy" on DBS said the stock has been unjustly punished partly because of slowing credit growth and a possible peak in net interest margin (NIM).
"At this juncture, we would say that it is not as bad as it seems," said HSBS Global Research. "It is true that loan growth is coming in lower than initially expected at the start of the year but NIM is still significantly higher than a year ago."