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Singapore shares close higher on Wall Street rebound
AN unexpected Wednesday rally on Wall Street enabled the Straits Times Index on Thursday to rebound 33.75 points or 1.17 per cent to 2,919.83. It was only the second time in nine trading sessions that the index managed a rise, but although it helped ease the pressure in the broad market, brokers drew little consolation from this, pointing instead to the low volume which has plagued the market this year - the one billion units worth S$775.8 million traded was the lowest in two weeks.
US stocks rallied on Wednesday after release of the minutes of the latest US Federal Open Markets Committee (FOMC) meeting which more or less confirmed the committee will start raising interest rates in December, albeit at a slow pace thereafter.
News reports suggested that the rally was possibly because of relief that after many months of uncertainty markets now have a better picture of how to position themselves in the coming months.
The STI's rebound was led by Singtel and the three banks. In the property sector, shares of CapitaLand finished S$0.08 higher at S$3.15 on volume of 12 million. Macquarie Warrants (MW) in its daily newsletter said Macquarie Equities Research (MER) has retained its "outperform" on the stock with 12-month target of S$4. "MER believes that CapitaLand shares are attractive given that they are trading at 0.75x price-to-book value and at a 38 per cent discount to their revalued net asset valuation," said MW.