singapore stocks surge higher boosted by wall street and regional cues 1148842015

Singapore stocks ended sharply higher on Thursday led by the massive overnight rally on Wall Street and returning confidence in regional stock markets.

Interestingly, companies recently targeted by short sellers made a solid comeback yesterday. Noble Group Limited (SGX:N21) jumped 14.44 per cent to SG$0.52, and Silverlake Axis Ltd (SGX:5CP) zoomed 19.57 per cent to SG$0.55.

In marine engineering, Keppel Corporation Limited (SGX:BN4) rose 2.65 per cent to SG$6.96 and Sembcorp Marine Ltd (SGX:S51) jumped 4.82 per cent to SG$2.39.

The three banks also moved up strongly. DBS Group Holdings Ltd (SGX:D05) was up 2.49 per cent to SG$18.09, United Overseas Bank Ltd (SGX:U11) gained 2.01 per cent to SG$19.75 and Oversea-Chinese Banking Corp. Limited (SGX:O39) rose 3.15 per cent to SG$9.17.

Indices and sectors

The Straits Times Index (STI) ended 72.43 points or 2.52 per cent higher at 2,945.43, taking the year-to-date performance to -12.47 per cent.

The FTSE ST Mid Cap Index gained 3.06 per cent, while the FTSE ST Small Cap Index rose 4.16 per cent.

The Singapore Exchange traded a volume of 1,957.3 million shares valued at SG$1,614.7 million. Gainers outnumbered losers by 459/61.

Amongst the FTSE ST sectors, the top gainers included technology (+7.96 per cent), utilities (+6.74 per cent), basic materials (+5.54 per cent), industrials (+4.22 per cent), oil and gas (+4.14 per cent), China top index (+3.80 per cent), CataList index (+3.53 per cent), maritime (+3.45 per cent) and consumer goods (+3.01 per cent). There were no losing sectors.

Stocks

Raffles Education Corp Ltd (SGX:NR7) said net profit for the financial year ended June 30 crashed 69 per cent to SG$16.98 million mainly because of one-time gains recorded in the prior year period. Revenue was down 4 per cent to SG$119.9 million, according to the Business Times.

According to a Bloomberg report, Mitsubishi Corp (TYO:8058) will acquire a 20 per cent stake in Olam International Ltd (SGX:O32), a commodity trading company controlled by Singapore’s state investment company.

Fashion retailer F J Benjamin Holdings Ltd (SGX:F10) reported a net loss of SG$15.6 million during the year ended June 30, much better compared to the loss of SG$22.1 million in the prior year. Turnover fell by 20 per cent to SG$293.4 million, following the group’s repositioning of its operations to focus on a portfolio of Singapore, Malaysia and Indonesia, according to Channel News Asia.

Ezra Holdings Limited (SGX:5DN), whose shares were suspended from trading on Thursday pending an announcement, is likely to sell a 50 per cent stake in its subsea business to Japanese engineering company CHIYODA CORPORATION (TYO:6366), according to the Straits Times. The deal could assign a value of over US$1 billion (SG$1.40 billion), including debt, to Ezra’s subsea business.

Sim Lian Group Ltd (SGX:S05) said net profit for the full year ended June 30 vaulted 41 per cent to SG$240.37 million, while revenues jumped 67 per cent to SG$1.19 billion, according to the Business Times. Revenue at the property development division grew 80 per cent, while the construction division surged 33 per cent. The company declared a first and final dividend of 7.28 Singapore cents, up from 4.6 cents in fiscal 2014.

Economic news

Data released by Singapore’s Department of Statistics on Thursday showed that overall sales for the services sector rose 3.5 per cent year-on-year during the April to June quarter, on the back of strong performance in the Financial and Insurance and Health and Social Services sectors, as reported by Channel News Asia.

The Lion-OCBC Capital Asia Fund I, LP, the first private equity fund floated by OCBC Bank and its asset management subsidiary Lion Global Investors, met with strong demand from outside investors, ending 40 per cent higher at SG$550 million compared to the initial target of SG$400 million. The fund will invest in small and medium-sized firms in Singapore, Malaysia, Indonesia and China, said the Straits Times. “Investors in the fund were attracted by the superior returns that MCU has consistently delivered for OCBC of more than 20 per cent internal rate of return in the past six years as its private equity unit, as well as by the fund’s unique positioning as a bank-sponsored investment fund,” said Daniel Kwan, head of OCBC Bank’s private equity investment unit Mezzanine Capital Unit (MCU).

Global oil prices shot up over 10 per cent on Thursday (August 27) led by impressive US economic growth data, according to Channel News Asia. US benchmark West Texas Intermediate (WTI) for delivery in October jumped US$3.96 to US$42.56 a barrel while European benchmark Brent oil for October delivery gained US$4.42 at US$47.56 a barrel in London.

Data released by the US Commerce Department on Thursday showed that GDP during the April to June quarter grew at a 3.7 per cent annual pace instead of the 2.3 per cent rate estimated last month, mainly due to solid domestic demand. The figure was much better than economists’ expectations of a revised 3.2 per cent growth rate.

On Wall Street Thursday, US stocks recorded another solid session of gains on the back of strong US GDP growth and a relief rally in global stock markets. The Dow Jones Industrial Average gained 369 points, or 2.3 per cent, to 16,654.77, wiping out all of the declines of early this week, while the S&P 500 and the Nasdaq Composite both gained around 2.5 per cent to 1,987.66 and 4,812.71 respectively.