Singapore shares extended their gains for a sixth session to hit a two-week high, in line with other Asian bourses on hopes Greece will be able to avoid a near-term bankruptcy.
By 10:42 a.m., the Straits Times Index was up 0.5% at 3,005.02, while the MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.2%.
Commodity trader Noble Group was the largest gainer on the STI, rising 3.7% to $1.115 while palm oil firm Golden Agri-Resources rose 2.5% to $0.625.
However, Nomura said it saw a subdued outlook for Singapore in 2013 as the country’s ongoing economic restructuring is expected to drag on corporate earnings.
Consensus estimates of an 11% earnings per share growth in 2013 for Singapore appears too optimistic, with the greatest earnings risks coming from banks, developers and casino gaming sectors, Nomura said.
The brokerage was bullish on conglomerates such as Keppel Corp, Sembcorp Industries and Jardine Matheson Holdings, for their ability to generate steady earnings growth that can support dividends.
But Nomura was bearish on casino operator Genting Singapore Plc given Singapore’s strict regulation over the industry. Developers are also expected to underperform as fundamentals deteriorate, with rising vacancies and large oncoming supply of homes.
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