STI jumps 0.8% on China boost

SINGAPORE shares rallied on Monday (Aug 28), extending last Friday’s gains as investors cheered China’s latest measures to boost investor confidence in its ailing stock and property markets.

The key Straits Times Index gained 0.8 per cent or 23.8 points to 3,213.68.

Almost all key gauges across the Asia-Pacific, from Japan, Hong Kong, China, Taiwan and South Korea to Australia, also finished higher. But caution remained in the air, ahead of data on US jobs and inflation and China manufacturing over the course of the week.

“Of course, no one will have missed the Federal Reserve chairman highlighting, despite significant domestic economic disturbances, that the Fed may indeed have to raise rates further to head off a re-kindling of inflation,” said Clifford Bennett, chief economist at ACY Securities. He was referring to Jerome Powell’s speech in Jackson Hole, Wyoming.

“It is a Monday, and that is usually a buying day across Asia and into the US timezone. For the moment, expect some misplaced buying enthusiasm at first,” he added. “But as with last week, may I suggest the rally, if any, will be short-lived. Get ahead of the crowd and be prepared for a continuing bear market.”

On the home front, some 1.6 billion securities worth S$927.7 million changed hands on Monday. Gainers trounced losers, with 318 counters up and 199 down.

OCBC advanced 0.8 per cent or S$0.10 to close at S$12.46, notwithstanding a disruption to its banking services earlier in the day. The bank said these were restored from a little past noon.

ISOTeam retreated 4.4 per cent or S$0.002 to S$0.043. The counter was the day’s eighth-most actively traded, with 26 million shares done.

The Catalist-listed building maintenance and estate upgrading company said it returned to the black for the full year ended June 2023, ending a three-year losing streak. Its net profit for the year stood at S$1.4 million, versus a loss of S$13.2 million the year before. This came on the back of a 14 per cent improvement in revenue, to S$110.4 million.

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ISOTeam cited a recovery in the construction sector as well as repairs and redecoration works post pandemic for its better showing.

Yangzijiang Shipbuilding inched up nearly 3 per cent or S$0.05 to S$1.77, and was the third-most traded stock on Monday, with a volume of 47 million shares.

Earlier in the month, the mainboard-listed vessel maker reported a 47 per cent jump in net profit to 1.7 billion yuan (S$324.6 million) for the first half ended June. Following the stronger-than-expected showing, several research houses issued positive ratings and raised their target prices for the stock.

Singapore stocks have booked net institutional fund inflows for three consecutive weeks through Aug 25, said Geoff Howie, market strategist at the Singapore Exchange. In the month-to-date, the bourse has drawn inflows of some S$440 million.

Howie said that with four trading sessions left to close the month, August is poised to be the first month in which local stocks have booked net inflows since November 2022.