Hopes for firm Wall St help STI gain 1.3%

A 30-point rise in the Dow futures helped the Straits Times Index kick off the week and final quarter with a 42.19 point or 1.3 per cent gain to 3,262.1 on Monday. Rises in the three banks, Singtel and Jardine stocks were the largest contributors, though volume at 1.3 billion units worth S$906 million was not spectacular. Excluding warrants, there were 259 rises versus 139 falls so gains were broad-based.

Brokers said that Wall Street's optimism over proposed tax reforms underpinned the gains; one observed that "for one year since the US elections, stocks have been going up non-stop to record high after record high".

Also a factor was that other than a slight blip towards the end of last month, investors appear unfazed by the heightened prospect of a third US interest rate hike this year in December. In the federal funds futures market, the implied probability of this occurring is currently 70 per cent.