STI snaps three-day losing streak to close 2.03% higher on Tuesday

THE Straits Times Index (STI) rose 52.97 points or 2.03 per cent to 2,666.85 on Tuesday, snapping a three-day losing streak after the US Federal Reserve said Monday that it will begin buying the debt of individual US companies.

The Fed had previously only bought exchange-traded funds. Its commitment to come directly to the aid of distressed companies persuaded equity investors to stop worrying about the disjoint between markets and the economy. Singapore investors cheered too as parts of the economy will resume business on Friday as the virus infection rate stabilises.

About 1.6 billion securities worth S$1.57 billion changed hands on the Singapore Exchange on Tuesday. Gainers outnumbered losers 355 to 124.

Retail-focused Reits staged a strong rebound after the Singapore government announced late Monday that it would start to relax lockdown measures from Friday - earlier than expected. 

Lendlease Reit rose 7.35 per cent or five Singapore cents to S$0.73. Capita Commercial Trust rose 6.40 per cent or 11 Singapore cents to S$1.83. CapitaMall Trust rose 4.90 per cent or 10 Singapore cents to S$2.14.

DBS analyst Derek Tan wrote in a Tuesday report: "While we had anticipated the end of the storm for the retail sector to be close as per our recent upgrade on May 29, the move to shift forward Phase 2 reopening comes as a positive surprise. The green light will be given for more than 90 per cent of all retail tenants in the various malls to resume operations... On-the-ground sentiment shows that Singaporeans (or those around us at least) are ready to flock out of their individual households after being cooped up for almost 2.5 months."

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Top active Rex International rose 11.66 per cent or 1.9 Singapore cents to S$0.182 on volume of 132.6 million.

Top gainer DBS closed 36 Singapore cents or 1.68 per cent higher at S$21.66. 

Top loser Jardine Matheson closed 50 US cents cents or 1.16 per cent lower at US$42.61.

Tuan Sing, which has interests across real estate, hospitality and printed circuit board manufacturing, surged 25.53 per cent or six Singapore cents to S$0.295 after DBS Research initiated coverage on Tuesday with a S$0.38 target price. 

Regional markets returned to risk-on mode. The Hang Seng rose 2.39 per cent, the KLSE rose 1.26 per cent, the Shanghai Composite went up 1.44 per cent, and the Nikkei, by 4.88 per cent.