Singapore Shares End Higher; STI Expected To Continue Consolidation
First Published Tuesday, 20th March 2012 10:19 am - © 2012 Dow Jones
SINGAPORE -(Dow Jones)- Singapore shares ended higher on Tuesday, bucking weakness across most of the region, as investors nibbled on stocks again after three sessions of declines for the local bourse.
Across Asia, markets were generally lacklustre due to the absence of positive economic indicators, while volume was weak in part due to the closure of markets in Japan for a public holiday.
Singapore's benchmark Straits Times Index closed 0.4%, or 12.64 points, higher at 3,002.73, after hitting an intraday high of 3,017.47.
Gainers outnumbered losers 208 to 146 and volumes were lower at 1.08 billion shares compared with 1.52 billion Monday.
The outperformance of the Singapore market versus its peers in the region was due to "catch-up" after it fell more than the region Monday, said SIAS Research analyst Ng Kian Teck.
He said the STI is still treading water and expects "the consolidation will continue for a couple more days until we see more economic indicators coming out." Ng expects the index to continue to move in a 2,980-3,030 band.
Among the best performing STI names, CapitaMalls Asia ended up 3.0% at S$1.695, SembCorp Industries added 1.4% to S$5.20 and StarHub gained 1.0% to S$3.08. While these stocks didn't rise on any company-specific news, investors generally pick up blue-chip stocks that are considered safe havens in uncertain times.
Among the weaker performers on the index, Neptune Orient Lines fell 1.7% to S$1.415 and Singapore Airlines slipped 0.4% to S$10.89. Fuel costs make up a large part of both companies' cost bases, and so higher oil prices dent the stocks' attractiveness.
STX OSV Holdings gained 1.4% to S$1.78 after the builder of offshore specialized vessels announced a pair of vessel construction contracts worth around S$250 million in total.
The company won a new contract for the construction of an advanced subsea support vessel for Island Offshore worth more than NOK500 million, along with a contract worth about NOK650 million to design and build an offshore subsea construction vessel for Norwegian offshore engineering company DOF ASA.
The broader offshore & marine sector was also higher, helped by the 1% rise in oil prices in New York Monday.
Offshore construction firm Ezra Holdings gained 2.3% to S$1.125 and offshore logistics and support services firm Ezion Holdings rose 4.5% to S$0.935.
One weak spot in the sector, however, was China-based shipbuilder Yangzijiang Shipbuilding Holdings, which fell 1.5% to S$1.355.
Citigroup Tuesday downgraded its investment recommendation on the stock to Sell from Buy, citing "the structural decline in shipbuilding profitability, industry-wide."