STI shy of 3,000 points as it inches up 0.18%

THE benchmark Straits Times Index (STI) registered modest gains of 0.18 per cent or 5.52 points on Tuesday. Still, it was a whisker shy of the 3,000 mark - at 2,995.92 points at the close.

Sean Darby, Jefferies' global equity strategist, is modestly bullish about Singapore shares, and said the dividend discount model suggests that the STI should trade around 3,200. He pointed out that booming money supply and a strong balance of payments are keeping liquidity conditions ample, while the dividend story remains intact.

Gainers outnumbered decliners 287 to 195 on the broader market on Tuesday, with S$1.40 billion transacted over 2.93 billion securities.

Mainboard-listed Fu Yu Corp was one of the biggest decliners after it lifted its trading halt following an announcement that its founders had sold stakes of 29.8 per cent in total for S$58.3 million to local fund-management firm Pilgrim Partners Asia. The shares were down 8.1 per cent to S$0.285.

Another mainboard-listed firm, Sunningdale Tech, benefited from a sweetened proposed corporate action, however. The offer price for the precision plastic components manufacturer was raised to S$1.65 from S$1.55 on Tuesday, resulting in the counter being among the biggest gainers. It was trading at S$1.62 at the closing bell, up 3.85 per cent.

Dimethylformamide producer Jiutian Chemical was the most active counter, with 247.5 million shares traded. Its shares closed 3.81 per cent up at S$0.109. CGS-CIMB recently initiated coverage on the firm with a target price of S$0.145 on favourable industry dynamics.

Key regional indexes generally performed well, with gains of over 1 per cent.

Hong Kong's Hang Seng index rose 2.70 per cent to 29,642.28 points; South Korea's Kospi clocking a marginally smaller gain of 2.61 per cent to close at 3,092.66 points.

Japan's Nikkei 225 closed at 28,633.46, up 1.39 per cent, while Australia's S&P/ASX 200 was trading at 6,742.62 points at the closing bell, notching a 1.19 per cent gain.

The Shanghai Composite Index, however, was 0.83 per cent lower at 3,566.38 points, becoming one of the few key indexes that closed in the red. It had company from the FTSE Bursa Malaysia Kuala Lumpur Composite Index, which was 0.47 per cent lower at 1,601.88 points.