Singapore stocks inch up after Fed rate cut; STI rises 0.2%

[SINGAPORE] Singapore stocks ended higher on Thursday (Dec 11) after the US Federal Reserve cut interest rates by 25 basis points.

The benchmark Straits Times Index (STI) gained 0.2 per cent or 8.93 points to finish at 4,520.83. Meanwhile, the iEdge Singapore Next 50 Index lost 0.1 per cent or 0.91 points to 1,434.11.

Across the broader market, gainers edged out losers 256 to 244 after 1.1 billion securities worth S$1.3 billion changed hands.

Key regional indices were mixed. Hong Kong’s Hang Seng Index was flattish, Japan’s Nikkei 225 index lost 0.9 per cent, South Korea’s Kospi lost 0.6 per cent and the FTSE Bursa Malaysia KLCI gained 0.9 per cent.

Hongkong Land led the gainers on Singapore’s blue-chip index, rising 5.5 per cent or US$0.36 to end at US$6.93.

The worst performer among STI constituents was Jardine Matheson , which fell 2.7 per cent or US$1.85 to US$66.65.

The three local banks ended higher. DBS gained 0.5 per cent or S$0.27 to S$54.39, OCBC was flat at S$18.95, and UOB was up 0.3 per cent or S$0.10 at S$34.28.

The top performer on the iEdge Singapore Next 50 was BRC Asia , which rose 2.5 per cent or S$0.10 to S$4.08. The index’s biggest loser was UOB Kay Hian , which fell 2 per cent or S$0.05 to S$2.47.

Jose Torres, senior economist at Interactive Brokers, said the latest Fed moves mark a “reversal” from quantitative tightening.

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He added that the addition of “new fixed-income instruments” is similar to quantitative easing, bringing “music to the ears of stock bulls, as it bolsters liquidity conditions and adds fuel to the fire of some of the most speculative areas in equities”.

“Indeed, the small-cap, cyclically oriented Russell 2000 has reached a fresh all-time record for the second day in a row, and all of the major US domestic benchmarks are advancing on the session,” said Torres.