The Singapore stock market picked up less than a pair of points on Wednesday - but that was enough to snap the two-day losing streak in which it had fallen almost a dozen points or 0.3 percent. The Straits Times Index settled just below the 3,160-point plateau, and now analysts are forecasting renewed selling pressure at the opening of trade on Thursday.
The global forecast for the Asian markets is negative thanks to renewed concerns over the looming fiscal cliff in the United States. Soft economic data adds to the cautious sentiment, as does profit taking after mostly solid gains in the regional bourses earlier this week. The European markets were higher on Wednesday and the U.S. bourses were down - and the Asian markets are tipped to follow the latter lead.
The STI finished barely higher on Wednesday as gains from the plantation stocks were offset by weakness from the property sector.
For the day, the index added 1.78 points or 0.06 percent to finish at 3,158.57 after trading between 3,152.04 and 3,177.10 on volume of 3.30 billion shares. There were 204 gainers and 225 decliners.
Among the actives, Olam International spiked 4.4 percent, Noble Group climbed 2.6 percent and Wilmar jumped 1.3 percent, while CapitaLand shed 1.1 percent, CapitaMalls Asia lost 0.5 percent and City Developments dipped 1.5 percent.
The lead from Wall Street suggests consolidation as stocks came under pressure on Wednesday after showing a lack of direction throughout much of the trading day. Profit taking following recent strength contributed to the pullback by the markets.
Continued uncertainty about the looming fiscal cliff also generated some selling pressure, with remarks by President Barack Obama and House Speaker John Boehner suggesting that an agreement might not be as close as it appeared earlier this week. Obama was highly critical of Boehner's proposed "Plan B" legislation, which would extend tax cuts for people making up to $1 million.
Boehner unveiled the "Plan B" proposal on Tuesday as an alternative if lawmakers are unable to reach a broader budget agreement. Obama claimed that the legislation continues large tax cuts for the very wealthiest individuals while raising taxes on millions of working families.
Later in the day, Boehner said the House will pass the bill on Thursday and argued that the president would be responsible for the largest tax increase in American history if he can't persuade Senate Democrats to approve the legislation.
On the economic front, the Commerce Department reported that housing starts fell 3.0 percent to an annual rate of 861,000 in November from the revised October estimate of 888,000. Economists had expected housing starts to fall to 865,000 from the 894,000 originally reported for the previous month.
Also, the Commerce Department said building permits rose 3.6 percent to an annual rate of 899,000 in November from the revised October rate of 868,000. With the increase, building permits reached their highest annual rate since July of 2008.
The major U.S. markets were down on Wednesday as the Dow fell 98.99 points or 0.7 percent to finish at 13,251.97, while the NASDAQ dipped 10.17 points or 0.3 percent to close at 3,044.36 and the S&P slid 10.98 points or 0.8 percent to end at 1,435.81.
by RTT Staff Writer
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