Latest news with #KospiCompositeIndex
Business Times
13 hours ago
- Business
- Business Times
Singapore shares rise on Israel-Iran ceasefire; STI up 0.7%
[SINGAPORE] Local shares ended higher on Tuesday (Jun 24), tracking a rally on Wall Street after the US brokered a ceasefire in the conflict between Israel and Iran. The benchmark Straits Times Index (STI) gained 0.7 per cent or 25.04 points to 3,904.3. Across the broader market, gainers outnumbered losers 346 to 174, after 1.2 billion securities worth S$1.4 billion changed hands. Elsewhere in Asia, key indices largely closed higher. The Hang Seng Index rose 2.1 per cent, the Nikkei 225 gained 1.1 per cent, while the Kospi Composite Index was up 3 per cent. Meanwhile, the FTSE Bursa Malaysia KLCI lost 0.2 per cent. James Ooi, market strategist at Tiger Brokers, said there were already signs of a relatively muted market impact from the Israel-Iran conflict, and investors now appear to be pricing in a potential extension of the ceasefire. But investors still need to remain cautious, Ooi said. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'If the conflict re-escalates, particularly if oil prices spike again, it could reignite inflation fears and trigger renewed market volatility,' he said. In the meantime, market participants are likely to stay focused on larger macro drivers such as ongoing tariffs, deregulations, tax cuts, and US President Donald Trump's anticipated 'Big Beautiful Bill', he added. On the STI, Jardine Matheson Holdings was the top gainer, rising 2.3 per cent to US$46.35. Singtel was the biggest decliner, falling 1.5 per cent to S$3.83. The local banks were up. DBS gained 1 per cent to S$44.30, OCBC rose 1.4 per cent to S$16.16, while UOB closed 1.6 per cent higher at S$35.32.
Business Times
08-05-2025
- Business
- Business Times
US Fed rate pause keeps Asian markets steady, but watch out for tariffs: market observers
[SINGAPORE] The US Federal Reserve keeping rates steady is a plus for stability in Asia's financial markets, but trade uncertainty from tariffs remains a key risk for equities and bonds in the region, said market observers. The Federal Open Market Committee (FOMC) on Wednesday (May 7) agreed to leave the central bank's benchmark interest rate unchanged in the 4.25 to 4.5 per cent range, citing higher inflation risks and increasingly uncertain economic outlook. In a press conference, Fed chair Jerome Powell noted that trade policy remains a source of uncertainty that affirms the Fed's need to be in a wait-and-see mode. He warned that the significant tariff hikes that have been announced could lead to a slowdown in economic growth and an uptick in long-term inflation. Asian markets are mostly trading higher – mirroring Wall Street gains overnight – following the FOMC decision, which was largely expected. As at 12.20 pm Singapore time, Korea's Kospi Composite Index and Japan's Nikkei 225 were trading up. Hong Kong's Hang Seng Index was up 1.1 per cent, while China's Shenzhen Component Index also rose nearly 1 per cent. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Singapore's Straits Times Index edged slightly lower at the opening bell, but has since recovered. As at 12.20 pm, the index ticked up 0.2 per cent. Plus for bonds, nuanced equities take Market observers said the Fed's move will be generally constructive for bonds and equities in Asia. Simon Ree, founder of online trading academy Tao of Trading, said Asian bonds could see steady yields, which is 'good news for investors looking for safety', as pressure comes off central banks in the region to hike rates. The effect of the Fed standing pat is more nuanced on equities. 'Steady rates can be positive for sectors like real estate – cheaper financing, higher property values – and this is big in Asia,' said Ree. If rates trend lower, consumer stocks may also get a lift. However, as Asia 'lives and breathes global trade', the heating up of trade tensions could hit export-heavy sectors such as technology and manufacturing, he said. Ray Sharma-Ong, South-east Asia head of multi-asset investment solutions at Aberdeen Investments, said China equities should be resilient relative to Fed policy decisions. 'In addition to fiscal and monetary support, China's activity growth, as shown in hard data, remains resilient, and China has the added lever of its stock market support programme,' he said. He noted that the US and China have both acknowledged that the current level of tariffs between the two nations is unsustainable. 'We expect a slow but eventual de-escalation in US-China trade tensions, which will be welcomed by the markets,' he said. Back home, Singapore's real estate – both developers and real estate investment trusts – could see some upside as financing stays cheap and property values hold firm, Tao of Trading's Ree noted. Meanwhile, banks are 'a mixed bag' as steady rates indicate their interest spreads may not budge much, while their ties to global trade and capital flows make them dependent on current trade tensions. Charmaine Tan, research analyst at FSMOne Singapore, said Singapore's financials may see mixed impacts concerning steady rates, while lending margins might not expand further. However, 'the steadier environment can improve asset quality and loan demand if the macro backdrop remains resilient', she said. Said Ree: 'Cyclical and export-driven sectors like industrials or consumer discretionary could stumble if trade uncertainty drags on.' Rate cuts, if any? Tai Hui, Asia-Pacific chief market strategist of JPMorgan Asset Management, said the June meeting appears unlikely for a rate change, but July presents 'a realistic window for the Fed to consider rate cuts, contingent on further data and policy developments from the White House'. In his view, investors of US Treasury bills may focus on potential bond yield declines and corresponding bond price increases. DBS senior rates strategist Eugene Leow said the Fed is likely to remain reactive instead of pre-emptive in the current environment, as Trump's trade deals will take centre stage. With 'a lot of attention' being placed on the upcoming China-US talks, he believes that the 'range of possibilities can be pretty wide, which probably accounts for the considerable Fed easing priced into US dollar rates'.
