Market Commentary and Intraday News

Singapore Stocks May See Narrow Trading Range

275 days ago

(RTTNews) - The Singapore stock market on Wednesday wrote a finish to the three-day winning streak in which it had collected more than 35 points or 1.2 percent on its way to its highest close for the year. The Straits Times Index finished just above the 3,060-point plateau, and now investors are looking at a flat lead when the market kicks off trade on Thursday.

The global forecast for the Asian markets is mixed following inconclusive economic data from the United States, as well as uncertain news from Europe. Policymakers of the Bank of England were unanimous in maintaining quantitative easing at GBP 375 billion early this month, the minutes of the August meeting revealed on Wednesday. Also, reports suggest that Greece is set to seek an extension of the austerity program agreement with its lenders. The European and U.S. markets were mixed, and the Asian bourses figure to follow suit.

The STI finished modestly lower on Wednesday following losses from the plantation stocks.

For the day, the index lost 25.73 points or 0.83 percent to finish at 3,062.11 after trading between 3,056.64 and 3,078.03 on volume of 1.36 billion shares. There were 242 decliners and 125 gainers.

Among the actives, Wilmar International plunged 7.1 percent and Genting Singapore jumped 2.3 percent.

The lead from Wall Street remains inconclusive as stocks turned in another lackluster performance on Wednesday, extending the sideways move seen over the past week. Traders expressed continued uncertainty about the near-term outlook for the markets following a mixed batch of U.S. economy data.

The New York Federal Reserve reported an unexpected contraction in regional manufacturing activity, as its general business conditions index dropped to - 5.9 in August from 7.4 in July, with a negative reading indicating a contraction in regional manufacturing activity. Economists had expected the index to show 7.0.

Meanwhile, the Federal Reserve said industrial production increased by 0.6 percent in July compared to economist estimates for an increase of about 0.5 percent. The growth reflected increased output in each of the manufacturing, mining, and utilities sectors.

Also, the National Association of Home Builders said that its index of homebuilder confidence climbed to 37 in August from 35 in July - beating forecasts for an unchanged reading. With the increase, the homebuilder confidence index rose to its highest level since coming in at 39 in February of 2007.

The Labor Department also released a report showing that consumer prices unexpectedly came in unchanged for the second consecutive month in July.

Among individual stocks, shares of Target moved to the upside after the discount retailer reported better than expected Q2 earnings and raised its full-year guidance. Also, apparel retailer Abercrombie & Fitch also turned in a strong performance after reporting second quarter earnings that fell year-over-year but came in above estimates.

Meanwhile, shares of Deere tumbled by 6.3 percent after the agricultural equipment giant reported third quarter earnings that increased by less than analysts had expected. The company also lowered its full-year revenue guidance.

The major U.S. averages were mixed on Wednesday for the fifth time in the past six sessions. The Dow edged down 7.36 points or 0.1 percent to finish at 13,164.78, while the NASDAQ rose 13.95 points or 0.5 percent to end at 3,030.93 and the S&P 500 inched up 1.60 points or 0.1 percent to 1,405.53.

In economic news, Singapore's retail sales decreased 0.9 percent annually in June, the Department of Statistics said on Wednesday - well shy of forecasts for a 0.1 percent increase. In May, sales had increased by 0.6 percent, which was revised up from 0.5 percent. On a monthly basis, sales decreased a seasonally adjusted 0.4 percent in June, after falling 2.7 percent in May. Economists were looking for a 0.9 percent contraction.

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