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mirage
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05-Oct-2007 08:59
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Quotes: Singapore shares close higher on blue-chip gains led by SIA, properties Singapore shares closed higher Thursday as investors shrugged aside concerns about the US economy and bought into select blue chips such as Singapore Airlines (SIA) and property heavyweights. Gains in construction stocks also supported the index. DMG & Partners Securities head of research for retail, Terence Wong, said the market is holding up well given Singapore's firm fundamentals. "The economy is very strong in the short and mid-term. Domestically we are firing on all cylinders," Wong said. He said property and construction activities will continue to support growth, with the oil and gas sector also doing well. The Straits Times Index (STI) closed up 29.19 points or 0.8 percent at 3,783.81, after trading between 3,742.44 and 3,783.81. Gainers beat losers 460 to 361, with 864 shares unchanged. Volume traded was 3.8 billion shares worth 2.7 billion Singapore dollars. But Wong urged investors to tread cautiously with the STI's valuations, higher than what has been seen in the last five years, at over 18 times PE. UOB Kay Hian expects the index to head higher with banking, offshore & marine stocks and China stocks expected to outperform in October. "However, the risk/reward profile should be less attractive and investors should consider switching into defensive stocks," the brokerage said in a note. SIA gained 50 Singapore cents to 19.50 dollars following news that Singapore has signed an open skies agreement with the UK that will remove all restrictions on air services operated by carriers of both countries. Under the deal, Singapore and UK carriers are allowed to operate unlimited flights between the two countries and fly onwards to other destinations. Kim Eng Securities said the deal is highly positive for SIA, which may now use London's Heathrow as a waypoint for its transatlantic route to the US East Coast. Among other blue-chip gainers, Singapore Telecommunications was up 12 cents at 3.98 dollars, ST Engineering was up 6 cents at 3.90 dollars and Singapore Press Holdings was up 2 cents at 4.34 dollars. Property heavyweights were also higher on expectations of healthy property price growth and strong broad-based demand over the next few years. City Developments rose 30 cents to 16.60 dollars, CapitaLand climbed 10 cents to 8.35 dollars, and Keppel Land added 10 cents to 8.65 dollars. Banks were mostly higher on expectations they will see double-digit loan growth going forward amid a booming economy. DBS Group added 20 cents to 22.40 dollars, Oversea-Chinese Banking Corp gained 15 cents to 9.20 dollars, while United Overseas Bank was unchanged at 22.40 dollars. Construction stocks also supported the index with the industry's uptrend expected to continue amid sustained economic growth. Goldman Sachs said it expects a re-rating on the Singapore construction sector "on increased visibility in cycle strength and sustainability, and positive newsflow on contract awards." Among construction stocks that were actively traded, Lian Beng was up 7.5 cents at 59 cents, Yongnam added 2.5 cents to 46.5 cents, CSC Holdings was up 1.5 cents at 37 cents and Chip Eng Seng rose 2 cents to 82.5 cents. Bourse operator Singapore Exchange succumbed to profit-taking following a sharp run-up in its share price in recent days, on continued speculation it will be involved in some kind of merger and acquisition (M&A) activity in the near term. |
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