Singapore stocks end week in the black amid festive cheer; STI up 0.9%
Yong Jun Yuan
SINGAPORE stocks rose on Friday (Dec 22) as investor sentiment appeared to improve ahead of the upcoming holidays.
The benchmark Straits Times Index (STI) gained 0.9 per cent or 27.82 points to 3,140.32. Across the broader market, gainers beat losers 311 to 248 after 1.2 billion securities worth S$810 million changed hands.
Regional markets were mixed. Hong Kong’s Hang Seng Index fell 1.7 per cent, while South Korea’s Kospi composite index edged down 0.02 per cent and Japan’s Nikkei 225 rose 0.1 per cent.
In a research note on Dec 22, Phillip Securities senior research analyst Glenn Thum maintained “overweight” on the local banking sector.
Thum noted that local interest rates continued their gradual incline, with the three-month Singapore Overnight Rate Average (Sora) up four basis points month on month to 3.75 per cent in November.
While overall loans to Singapore residents in all currencies declined by 4.19 per cent year on year in October, he noted that this is the smallest decline recorded in seven months.
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“Bank dividend yields are attractive with upside surprises due to excess capital ratios and a push towards higher return on equity.
“Stable economic conditions and rising interest rates remain tailwinds for the banking sector,” Thum said.
On the STI, OCBC was the top gainer, rising 1.9 per cent or S$0.23 to S$12.66.
The other two local banks were also in the black. DBS gained 1 per cent or S$0.33 to S$32, while UOB gained 0.6 per cent or S$0.16 to S$27.60.
Singtel was also heavily traded and rose 1.3 per cent or S$0.03 to S$2.44.
Meanwhile, DFI Retail Group was at the bottom of the table for the second day in a row. It lost 2.3 per cent or US$0.05 to US$2.14.
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