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Singapore Stock Market May Test Support At 3,100 Points

The Singapore stock market has moved lower in consecutive trading days, sinking almost 25 points or 0.8 percent along the way. The Straits Times Index now rests just above the 3,115-point plateau although it's expected to stop the bleeding on Monday.

The global forecast for the Asian markets is upbeat on renewed expectations for fiscal stimulus. The European and U.S. markets were sharply higher and the Asian bourses are tipped to open in similar fashion.

The STI finished modestly lower on Friday following losses from the financial shares and plantation stocks.

For the day, the index fell 11.06 points or 0.35 percent to finish at 3,115.03 after trading between 3,091.32 and 3,123.15. Volume was 1.47 billion shares worth 1.19 billion Singapore dollars. There were 202 decliners and 191 gainers.

Among the actives, Yangzijiang Shipbuilding skyrocketed 15.12 percent, while Thai Beverage plummeted 2.21 percent, Hongkong Land surged 1.80 percent, Golden Agri-Resources plunged 1.69 percent, Ascendas REIT tumbled 1.62 percent, Wilmar International skidded 1.59 percent, Comfort DelGro retreated 1.58 percent, SembCorp Industries declined 1.33 percent, CapitaLand Mall Trust dropped 1.13 percent, City Developments advanced 0.88 percent, Singapore Exchange sank 0.85 percent, Singapore Technologies Engineering shed 0.74 percent, Oversea-Chinese Banking Corporation lost 0.65 percent, SingTel fell 0.62 percent, CapitaLand slid 0.58 percent, Genting Singapore added 0.57 percent, Hutchison Port Holdings rose 0.55 percent, United Overseas Bank dipped 0.44 percent, Keppel Corp eased 0.17 percent and Singapore Press and DBS Group were unchanged.

The lead from Wall Street is broadly positive as stocks opened higher on Friday and the gains accelerated as the day progressed.

The Dow added 306.61 points or 1.20 percent to 25,886.01, while the NASDAQ jumped 129.37 points or 1.67 percent to 7,895.99 and the S&P 500 rose 41.08 points or 1.44 percent to 2,888.68. For the week, the Dow shed 1.5 percent, the NASDAQ lost 0.8 percent and the S&P fell 1 percent.

The rally on Wall Street reflected optimism about the world's central banks providing stimulus in order to prevent a global recession. European Central Bank official Olli Rehn expressed the need for significant easing in September to support the flagging eurozone economy, spurring investors.

The expectations for more stimulus fueled a pullback by U.S. treasuries and a subsequent increase in bond yields. The yield on the benchmark ten-year note had dropped below the two-year yield on Wednesday, sparking fears of an impending recession and a sell-off on Wall Street.

In economic news, the University of Michigan noted a significant deterioration in U.S. consumer sentiment in August. Also, the Commerce Department reported an unexpected slump in housing starts in July but a sharper than expected increase in building permits.

Crude oil futures settled higher Friday as recession fears faded amid hopes global central banks will announce further stimulus to revive economic growth. West Texas Intermediate Crude oil futures for September ended up $0.40 or 0.7 percent at $54.87 a barrel.

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