Singapore shares rise on Thursday amid regional rally; STI up 1.2%

SINGAPORE stocks gained on Thursday, tracking a broader rally across regional markets and following the US Federal Reserve policy meeting, which said it would not taper its monetary policy support as yet.

The benchmark Straits Times Index (STI) rose 1.2 per cent or 38.86 points on Thursday to close at 3,180.61.

Local bank stocks were among the gainers after the Monetary Authority of Singapore on Wednesday lifted their dividend restrictions. Shares of DBS, OCBC and UOB rose between 1.4 per cent and 2.1 per cent on Thursday; they were also the most actively traded counters by value for the day.

Jefferies equity analyst Krishna Guha said in a report: "We had expected caps to be lifted in phases, so a complete reinstatement is a positive surprise." He expects all three banks to raise their dividend to at least pre-pandemic levels, barring any large-scale inorganic growth aspiration and/or prudence exercised.

Singtel was the top STI gainer for the day. Its shares rose 2.2 per cent to close at S$2.28. Sembcorp Industries finished at the bottom of the STI performance table, its shares down 0.9 per cent to close at S$2.10.

Elsewhere in the region, shares in Hong Kong and Shanghai led gains on Thursday, following heavy losses earlier this week.

IG market strategist Yeap Jun Rong said that some optimism may have arisen, following a virtual meeting between China's securities regulator and major investment banks. He said: "This may suggest that the regulators are starting to be concerned about the market impact on its domestic firms and may provide some reprieve for investors."

The Hang Seng Index jumped 3.3 per cent, while the Shanghai Composite Index rose 1.5 per cent. The Kospi in South Korea gained 0.2 per cent, while the ASX 200 in Australia rose 0.5 per cent. Shares in Malaysia bucked the trend, with the KLCI falling 0.2 per cent.