Singapore shares up 0.3% ahead of the Fed rate decision

IT was a mixed showing for Asian equities ahead of the US Federal Reserve's October monetary policy decisions, with sentiment wavering on worries that the Phase one trade deal between the US and China might not be ready in November.

That said, the local market fared better than its peers on Wednesday, with the Straits Times Index (STI) once again lifted by the banks and the Jardine staple of companies to end the day at 3,207.92, up 10.88 points or 0.3 per cent.

Renewed trade worries saw most other markets in the Asia-Pacific such as Australia, China, Hong Kong, Japan and South Korea registering losses. Like Singapore, Malaysia bucked the trend, edging up 2.21 points or 0.1 per cent to 1,580.00.

"Any hope of a pre Federal Open Market Committee (FOMC) equity bounce in Asia was dashed after an unnamed US administration official told Reuters that Washington and Beijing are continuing to work on an interim trade agreement, but it may not be completed in time for the leaders of the two countries to sign in Chile next month," AxiTrader Asia-Pacific market strategist Stephen Innes said.

Even though investors were going into the October meeting increasingly confident that the US Federal Reserve will deliver its third 25 basis point rate cut of the year, some chose to err on the side of caution, booking profits after equities had a strong run since last Wednesday.

That said, Mr Innes remarked: "One thing that is for sure, the Fed is not going to deliver a hawkish rate cut with the trade war debate still in the balance. And frankly, I would be shocked if there was any material shift in policy that is not already factored into the equation".

In Singapore, trading volume stood at 1.06 billion securities, 89 per cent of the daily average in the first nine months of 2019. Meanwhile, total turnover clocked in at S$1.14 billion, 6 per cent over the January-to-September daily average.

Across the market, advancers pipped decliners 200 to 190. Five of the blue-chip index's 30 counters ended in the red.

On saw 28.6 million shares changing hands, Genting Singpaore was the STI's most active counter on Wednesday. It rose one Singapore cent or one per cent to 93.5 Singapore cents.

One dealer told The Business Times: "Despite not grabbing the headlines over the past two weeks, we continue to see sustained interest in Genting. Just last month, news reports showed it is one of the three candidates left in the quest to be handed a gaming licence to operate the Osaka integrated resort in Japan."

The local banks all ended higher. DBS Group Holdings closed up S$0.32 or 1.3 per cent to S$25.69, OCBC Bank added S$0.11 or one per cent higher at S$10.90 while United Overseas Bank, which releases third-quarter earnings on Friday, closed at S$26.60, gaining S$0.20 or 0.8 per cent.

National carrier Singapore Airlines added four Singapore cents or 0.4 per cent to end at S$9.24 after proposing a partnership together with Malaysia Airlines that could include revenue sharing on flights, expand codeshare routes, and participate in joint marketing activities to develop tourism.