PENNY-STOCK fever gripped the local stock market on Tuesday as the market's latest leader, CEFC International, continued its gravity-defying run with a stunning 64 per cent gain that took its rise in a little over a week to almost 900 per cent, creating spillover rises for several other low-priced issues such as Oceanus, Foreland Fabrictech, Sino Construction and WE.
The largest percentage gain for the day was reserved for China shoe-sole maker Qingmei, which rocketed up S$0.026 or 325 per cent to S$0.034 on a volume of 155.2 million.
Blue chips in the meantime stagnated, possibly as attention was diverted to penny stocks. The Straits Times Index underwent an unremarkable session, drifting within a narrow band before ending 2.07 points weaker at 3,371.41.
Turnover in unit terms rose to 3.2 billion units from an average of about 1.2 billion last week, though in dollar terms it amounted to only S$984.5 million. The top 20 active stocks were all priced below S$0.30 and the average unit value traded was S$0.31 - a clear indication of where the action for the day lay.
"If CEFC, which is loss-making, can rise 10 times in a few weeks, then why not others like it?" said a dealer. "Traders have had such a hard time this year, this is a chance for them to bang and bang hard."
Qingmei was queried by Singapore Exchange (SGX) in the late afternoon on Tuesday, while CEFC was queried by the SGX in the early afternoon. For CEFC, the exchange noted that it was the second query in a month.
When replying to SGX's first query on Monday, the company had drawn attention to an earlier announcement in which it said it was considering certain deals in China, which may or may not materialise. In its Tuesday query, the exchange reminded CEFC that a holding announcement could be made.