Singapore shares rose on Wednesday, but Wilmar International (WLIL.SI), the world’s largest listed palm oil firm, underperformed the broader market due to its property ventures in China that traders said deviate from its main business.
By the midday break, the Straits Times Index (STI) <.FTSTI> was up 0.34%, or 10.72 points, at 3,150.57. Total value of shares traded in the morning session was $605.4 million, up from $461.5 million on Tuesday.
“The local market is tracking the overnight advance from Wall Street. Oil prices continued to stay firm and that has resulted in better performance from our rig players,” said Ng Kian Teck, an analyst at SIAS Research.
He added that he sees the STI trading in a range of between 3,144 and 3,158 points after the midday break.
Wilmar shares fell as much as 5.1% after it said it will invest 889.2 million yuan ($175 million) in joint ventures with Kerry Properties and Shangri-La China to develop three sites in Yingkou City, China, for residential, commercial and hotel use.
At midday, Wilmar shares were down 4.2% at $5.67 on a volume of 24.2 million shares.
“Wilmar has been in the agriculture business, and all of a sudden they want to do something in property, that’s why the market reacted badly,” said Jasmine Lee, an analyst at Phillip Securities.
She added that recent property cooling measures by the Chinese government may also have dampened investor sentiment about Wilmar’s foray into the real estate market.
Shares of rig-maker Sembcorp Marine (SCMN.SI) rose as much as 2% after it won contracts worth US$400 million from Noble Corporation (NE.N) to build two jackup rigs, with options for another four that could lift the total value to US$1.2 billion.
At midday, Sembcorp Marine shares were up 1.8% at $5.08 on a volume of 2.4 million shares, around 40% of its average traded volume in the last 30 days.
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