Reits lead Singapore stocks higher after Fed holds rates steady; STI up 0.6%
Megan Cheah
SINGAPORE shares finished higher on Thursday (Dec 14), after the Federal Reserve signalled lower borrowing costs are on the horizon in 2024.
The benchmark Straits Times Index (STI) rose 0.6 per cent or 18.69 points to 3,122.95. Across the broader market, gainers outnumbered losers 385 to 211, with 1.6 billion securities worth S$1.5 billion changing hands.
The top STI constituent was real estate investment trust (Reit) CapitaLand Ascendas Reit , which gained 5.3 per cent or S$0.15 to S$2.99.
Other Reits also led gains in the index. Mapletree Industrial Trust shot up 5.2 per cent, Mapletree Pan Asia Commercial Trust climbed 4.9 per cent, while CapitaLand Integrated Commercial Trust advanced 4.7 per cent.
The trio of local banks ended mixed. DBS was at the bottom of the STI, falling 1.3 per cent or S$0.42 to S$31.40. Meanwhile, O CBC lost 0.3 per cent or S$0.04 to S$12.47.
UOB was the only bank gainer, ticking up 0.1 per cent or S$0.02 to S$27.79.
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Regional markets mostly gained in reaction to the Fed’s latest move.
Hong Kong’s Hang Seng Index rose 1.1 per cent, South Korea’s Kospi Composite Index climbed 1.3 per cent, while Bursa Malaysia KLCI added 0.6 per cent. However, Japan’s Nikkei 225 fell 0.7 per cent.
Vishnu Varathan, Mizuho Bank’s Asia head of economics and strategy, noted that US Treasury yields and the US dollar “went soft” after markets saw the Federal Open Market Committee statement as a sign that Fed hawks were turning dovish.
Despite the Fed’s seemingly dovish stance, however, he cautioned against aggressively selling off the US dollar ahead of the European Central Bank’s (ECB) December meeting, as the ECB could also lean with a “distinctly less-hawkish Fed”.
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