The Singapore stock market on Friday halted the three-day slide in which it had given away almost 25 points or 0.9 percent. The Straits Times Index finished just above the 2,810-point plateau, and now analysts are forecasting further support at the opening of trade on Monday.
The global forecast for the Asian markets is broadly positive in a relief rally after the conservative pro-bailout New Democracy party pulled out a victory in Sunday's crucial elections in Greece. New Democracy leader Antonis Samaras declared victory in the election and called parties to join a national salvation government, "as soon as possible." Delivering a victory speech on Sunday night, he said Greeks had voted to stay in the euro - which for at least the short term ought to make investors happy. The European and U.S. markets finished higher on Friday, and now the Asian bourses are tipped to open in similar fashion.
The STI finished sharply higher on Friday following broadly based gains, although the financials were particularly potent.
For the day, the index spiked 37.19 points or 1.34 percent to finish at 2,811.00 after trading between 2,772.47 and 2,814.00. Volume was 1.2 billion shares worth 1.07 billion Singapore dollars. There were 254 gainers and 119 decliners.
Among the gainers, Oversea-Chinese Banking Corp jumped 3 percent, while DBS Group Holdings climbed 1.8 percent and United Overseas Bank added 1.6 percent.
The lead from Wall Street is upbeat as stocks moved steadily higher on Friday after initially seeing modest strength. The strong upward movement came amid optimism that recent disappointing economic data and the lingering threats from Europe will lead the world's central banks to take additional steps to prop up the global economy.
Continued buying interest was generated by reports indicating that central banks from major economies are prepared to take necessary steps to stabilize the financial markets. The measures will offer banks billions of pounds in cheap credit in an effort to stimulate lending while also providing access to short-term money to deal with "exceptional market stresses."
A disappointing batch of U.S. economic data also seemed to provide further evidence that the economy needs additional stimulus to avoid a double-dip recession. The Federal Reserve reported an unexpected drop in industrial production in May, while Reuters and the University of Michigan showed a substantial deterioration in consumer sentiment in June.
The major averages saw further upside going into the close, ending the session near their best levels of the day as the Dow climbed 115.26 points or 0.9 percent to finish at 12,767.17, while the NASDAQ jumped 36.47 points or 1.3 percent to end at 2,872.80 and the S&P 500 surged up 13.74 points or 1 percent to 1,342.84. With the gains on the day, the major averages all moved higher for the second straight week. The NASDAQ rose 0.5 percent, while the Dow and the S&P 500 added 1.7 percent and 1.3 percent, respectively.
On the economic front, Singapore's retail sales increased 2.2 percent on year in April, the Department of Statistics said on Friday, sharply slower than the 8.9 percent in March, which was revised down from 9.1 percent. Economists were looking for a 6.9 percent increase. Compared to March, retail sales decreased a seasonally adjusted 0.9 percent in April, reversing the previous month's 1.7 percent rise. Economists expected sales to rise 1.5 percent month-on-month.
by RTT Staff Writer
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