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Singapore stocks hit a 2-month peak on Wall Street rally

Singapore stocks hit a 2-month peak on Wall Street rally
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First Published: Thu, Apr 03 2008. 12 34 AM IST
Updated: Thu, Apr 03 2008. 12 34 AM IST
Singapore: South-East Asian stocks mostly traded higher on Wednesday, following gains on Wall Street, with the Singapore benchmark touching a more than two-month peak, as investors bought DBS Group and City Development.
Dealers said demand for a $4 billion (Rs16,000 crore) capital raising from Lehman Brothers Holdings Inc. was seen in the region as a sign the worst of the credit crisis might be over. But uncertainty over the outlook for palm oil prices hit plantation stocks in Malaysia and Indonesia, dragging their benchmark indexes lower.
Singapore’s Straits Times Index rose to its highest since 25 January before ending up 2.56%, the Philippine index closed up 2.64% at its strongest level in about a month and stocks in Vietnam ended 0.79% higher. South-East Asia’s top lender DBS Group rose about 5%. The bank at its annual shareholder meeting said its long-held plans to expand beyond its core markets of Singapore and Hong Kong included possible acquisitions in West Asia and Australia. Bourse operator Singapore Exchange rose 8.5% on hopes a rebound in the city-state’s stock market, that has lost 9.8% of its value this year, would boost trading volumes. However, investors such as Leslie Phang at Schroders Private Client, Schroders wealth management arm, were cautious over the sustainability of the rally. “The fashion is that a lack of bad news is deemed good,” Phang said.
“How else can one explain the double-digit percentage rally to reward banks for only making another eight-digit loss? And to ignore the new orders weakness in the ISM data, but choose to selectively focus on the positive headline strength,” he said.
Malaysian stocks fell 0.86% with losses led by a 2.7% fall in Sime Darby, the world’s largest producer of palm oil. Plantation firm IOI Corp. fell 1.5%. Indonesian stocks were down 2.13%, led by a 6.5% drop in Astra International and a 4.8% slide in its plantation subsidiary Astra Agro Lestari. Plantation firm SMART Tbk fell 9%.
Still shares of Singapore-listed palm oil firms such as Wilmar International rose 2.9% after the top palm oil trader said it has won approval from Chinese authorities to increase prices of its cooking oil products, dealers said. Gains in the Philippines were led by conglomerate Ayala Corp. which rose 7%. In Thailand, Bangkok Bank and Kasikornbank both rose 2.2% each.
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First Published: Thu, Apr 03 2008. 12 34 AM IST