Singapore shares inched higher by midday, extending gains for
the fifth session, on hopes of progress in talks to resolve a
"fiscal cliff" in the United States, but gains are likely to be
capped by a U.S. Federal Reserve policy decision due later this
By 0531 GMT, the benchmark Straits Times Index rose
0.5 percent to 3,129.45, while the MSCI's broadest index of
Asia-Pacific shares outside Japan edged up 0.3
Goldman Sachs expects oil prices to fall in the coming years
due to new supply from shale sands, helping to boost corporate
profits which will support stock prices in Asia. Asian stocks
have gained 3.9 percent since the start of November.
"Something that has been a headwind for global growth has
become a tail wind," said Andrew Tilton, Goldman's chief
economist for the Asia-Pacific.
Goldman upgraded Singapore to 'overweight' and has a
12-month target of 3,500 points for the STI, citing its
attractive valuations and as it favours cyclicals compared to
defensive stocks going into 2013.
By midday, stocks sensitive to economic cycles such as palm
oil firm Golden Agri-Resources Ltd rose 2.3 percent to
S$0.66 while casino operator Genting Singapore Plc
gained 2 percent to S$1.295.
"We see (Singapore) as an attractive way to trade the ASEAN
growth story given its linkages with the fast growing ASEAN
emerging economies," said Goldman in a report, forecasting
earnings per share growth of 7 and 14 percent for 2013 and 2014,
respectively, in the country.
1335 (0535 GMT)
(Reporting by Charmian Kok in Singapore; Editing by Anand Basu;
STOCKS NEWS SINGAPORE-DBS acquisition may limit Suntec REIT
pipeline- Credit Suisse
Lender DBS Group Holdings' Ltd acquisition of a 30
percent stake in a Singapore office tower for S$1 billion shows
that capital values and fundamentals of prime grade A office
space will continue to hold up, said Credit Suisse.
However, the acquisition also means that Suntec Real Estate
Investment Trust is unlikely to acquire a stake in the
office tower, Marina Bay Financial Centre Tower 3, which was
initially expected by the market. This means a limited
acquisition pipeline for Suntec REIT.
The commercial REIT, which is managed by ARA Asset
Management Ltd, an affiliate of Cheung Kong (Holdings)
Ltd, previously acquired stakes in other offices, One
Raffles Quay, from the Hong Kong-listed property developer.
"This means that Suntec's future injection pipeline may be
limited as Cheung Kong has no further assets in Singapore,"
Credit Suisse said.
It maintains its 'underperform' rating and target price of
S$1.37, highlighting potential downside risk in net property
income due to disruption from upgrading works at its assets.
By 0254 GMT, Suntec REIT units were up 1.3 percent at
S$1.605, and have surged 49 percent since the start of the year,
outperforming the FTSE ST Real Estate Investment Trust's
33.8 percent rise.
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