RTTNews - The Singapore stock market on Thursday saw an end to the two-day losing streak in which it had given up just 5 points or 0.2 percent along the way. The Straits Times Index is closing on the 2,500-point plateau, and now investors are predicting that the market will break through that level at the opening of trade on Friday.
The global forecast for the Asian markets is firmly optimistic, with modest gains predicted for the housing and property sectors. Continued good news on the corporate earnings front is expected to add to the positive sentiment, along with solid economic data out of the United States. The European and U.S. markets finished with significant gains, and the Asian markets are also predicted to open higher.
The STI finished sharply higher on Thursday, boosted by gains among the financials and the properties.
For the day, the index jumped 34.07 points or 1.39 percent to close at the daily high of 2,484.90 after dipping as low as 2,455.51. Volume was 2.09 billion shares worth 1.73 billion Singapore dollars.
Among the gainers, Singapore Exchange jumped 4.9 percent, while DBS Group Holdings added 1.6 percent and CapitaLand gained 4.3 percent.
The lead from Wall Street is broadly positive as stocks staged a substantial rally following an encouraging report on existing home sales after a modest upward move at the opening bell on Thursday. The major averages all closed in positive territory by substantial margins, with the NASDAQ able to extend its winning streak for the twelfth straight session.
Earlier, buying interest was generated by data from the National Association of Realtors that showed that existing home sales increased for the third consecutive month in June. Existing home sales rose by 3.6 percent to an annual rate of 4.89 million units in June from a downwardly revised rate of 4.72 million in May. Economists had expected sales to rise to a 4.84 million unit rate from the 4.77 million unit rate originally reported for the previous month.
Although a separate report from the Labor Department showed that jobless claims rose in June, the figure rose by slightly less than economists had expected. First-time claims in the week ended July 18th rose to 554,000 from the previous week's revised figure of 524,000. Economists had expected jobless claims to increase to 557,000 from the 522,000 originally reported for the previous week.
Traders also delved into a series of earnings reports, with 3M (MMM), Ford (F) and Wyeth (WYE) reporting results that surpassed Wall Street estimates. McDonald's (MCD), AT&T (T), Qualcomm (QCOM) also beat forecasts, although by more modest margins.
The major averages gave back some ground going into the close, although they held onto standout gains. The Dow closed up by 188.03 points or 2.1 percent at 9,069.29, the NASDAQ advanced by 47.22 points or 2.5 percent to 1.973.60 and the S&P 500 rose by 22.22 points or 2.3 percent to 976.29.
In economic news, Singapore is scheduled to release June numbers for industrial production on Friday. Analysts are expecting a decline of 6.4 percent on year following the 2 percent annual expansion in May. Seasonally adjusted, output is called lower by 6.2 percent on month after the 1.6 percent decline in the previous month.
Also, consumer prices in Singapore dropped 0.5 percent year-on-year in June, after falling 0.3 percent in the preceding month, the Department of Statistics said Thursday. Economists expected consumer prices to fall 0.6 percent. Excluding accommodation costs, the prices slipped 1.4 percent annually in June.
On a monthly basis too, the consumer prices fell 0.5 percent in June, due to lower costs of housing as also clothing and footwear. Seasonally adjusted, consumer prices rose 0.2 percent in June from the previous month.
For the first six months of the year, consumer prices climbed 0.8 percent from the same period last year.
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