Bank stocks defy rating agencies' prognosis

THE Straits Times Index on Tuesday drifted within a narrow band before finishing at 2,955.23 for a gain of 3.04 points on the day after a late spike in the Dow futures suggested a seventh consecutive rise in the Dow Jones Industrial Average on Tuesday, and after Europe opened in the black.

Turnover was below average by recent standards at 2.3 billion units worth S$1.1 billion and the broad market was marginally weak, recording 190 rises versus 235 falls excluding warrants.

Some observers suggested a likely interest rate hike at this week's US Federal Open Market Committee meeting as a reason for the early weakness, but this was only half-hearted as a virtual certain rate hike had been priced into the market for at least three weeks now.