Singapore stocks turn positive for first time in 2016
The Straits Times Index on Friday closed 0.9 per cent higher at 2,906.80 points, the Hang Seng rose 0.8 per cent and the Shanghai Composite Index closed 1.7 per cent higher.
- Posted 18 Mar 2016 20:28
- Updated 18 Mar 2016 23:41
SINGAPORE: Singapore stocks are now higher than they were at the end of last year, as investors return to riskier assets, on signs that US interest rates will not rise as much as initially expected this year.
Following overnight gains on Wall Street, the Straits Times Index (STI) on Friday (Mar 18) closed 0.9 per cent higher at 2,906.80 points, moving into positive territory for the first time this year. The STI had a torrid start to 2016, losing nearly 10 per cent in the first two weeks alone.
Elsewhere in Asia, Hong Kong's Hang Seng rose 0.8 per cent to its highest level since the first week of January. The Shanghai Composite Index closed 1.7 per cent higher.
The change in sentiment was also seen in forex markets, where the US dollar fell against most Asian currencies. The Singapore dollar is currently trading around 1.357 to the greenback, near its highest level in eight months.
Looking ahead, an analyst said the US dollar could weaken in the near term. Macquarie’s head of strategy for fixed income and currencies, Nizam Idris, said: "In the shorter term, if we are looking only at the horizon of one to three months, there is very little room for the Fed to communicate a different view right now.
“The established view is that the Fed is very concerned about global growth. They are slowing down the pace of normalisation and that sort of view is likely to stay for now."