STI closes 1.4% higher amid regional rally
Uma Devi
SINGAPORE shares closed higher on Thursday (Dec 28), following a rally across most of the stock markets in the Asia-Pacific region ahead of the new year.
The benchmark Straits Times Index (STI) gained 1.4 per cent or 43.64 points to end the trading day at 3,214.40. Across the broader market, advancers outnumbered decliners 403 to 216, after 1.2 billion securities worth a total of S$1.3 billion changed hands.
Most indices in the region closed higher on Thursday, as traders took to bargain hunting in capital markets. The Hang Seng Index added 2.5 per cent, the Bursa gained 0.2 per cent, and the Kospi rose 1.6 per cent. The ASX 200 also gained 0.7 per cent, while the Nikkei 225 shed 0.4 per cent.
Although the STI appears to be on a tear, Singapore Exchange market strategist Geoff Howie warned that the rally appears to be due to “some mean-reversion factors” at play.
From a relative value perspective, the price of the STI to the FTSE Asia Pacific Index is currently near its five-year mean. However, on Dec 15, it was near a 20-month low, he said.
He noted that from for the last quarter of the year up to mid-December, the STI had been lagging the FTSE Asia Pacific Index, with its underperformance “possibly stretched to a point that has attracted relative value traders”.
DBS was the top gainer on the local bourse, booking a gain of 2.2 per cent or S$0.70 to close at S$33.04. The other two lenders, too, were among the biggest advancers for the day. UOB rose 1.7 per cent or S$0.48 to S$28.38, while OCBC added 1.1 per cent or S$0.14 to S$12.92.
Creative Technology was the biggest loser, falling 4.7 per cent or S$0.07 to S$1.42.
Seatrium , The Place Holdings and Genting Singapore were the top traded counters for the day by volume.
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