Rebound relief for Asian stocks; STI up 0.3% led by DBS, UOB

THE Straits Times Index (STI) ended Wednesday (Apr 17) at 3,154.69, up 9.93 points or 0.3 per cent, signalling that a knee-jerk reaction to a potential war in the Middle East may be coming to an end.

Singapore’s three local banks were the primary reason for the STI’s rebound. DBS and UOB – the most heavily traded counters by value in Singapore – were among the index’s best performers for the day.

DBS ended up 1.2 per cent at S$35.97, and UOB closed 1.3 per cent higher at S$29.61. OCBC , too, gained 0.4 per cent to end at S$13.57.

Across the broader market, however, advancers only just edged out decliners 271 to 268 – an indication that sentiment remained weak.

Asian markets were also mixed. Japan, Korea, Thailand and Indonesia ended Wednesday in negative territory. However, Hong Kong, China, Taiwan, Malaysia and the Philippines all closed higher.

The generally positive performance across Asia came in spite of hawkish comments from Jerome Powell, chairman of the US Federal Reserve.

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“Given the strength of the labour market and progress on inflation so far, it is appropriate to allow restrictive policy further time to work and let the data and the evolving outlook guide us,” Powell said.

His comments are likely to keep the US dollar elevated relative to regional currencies. Meanwhile, the weakness in the yen may be turning into a headwind for Japanese stocks.

“Much to the dismay of central bankers across the region, Tokyo has yet to take any measures to address the yen’s decline,” said Stephen Innes, managing partner at SPI Asset Management.