Anticipated Boost in Backing for Singapore's Stock Exchange Markets
The Singapore stock market experienced a positive close on Tuesday, breaking a four-day slide, and is expected to open higher again on Wednesday. The Straits Times Index (STI) now hovers just above the 3,900-point threshold.
The global market forecast for Asia is optimistic following the announcement of a ceasefire between Israel and Iran. European and U.S. markets previously showed growth, and Asian bourses are anticipated to follow suit.
The STI recorded a marginal increase on Tuesday, with financial shares leading the way, while property stocks and industrial issues exhibited mixed performances. The index closed at 3,904.30 after exploring a range between 3,890.87 and 3,910.83, with an addition of 25.04 points or 0.65 percent.
Prominent actives, such as CapitaLand Ascendas REIT, DFI Retail Group, CapitaLand Integrated Commercial Trust, CapitaLand Investment, City Developments, Comfort DelGro, DBS Group, Genting Singapore, Hongkong Land, Keppel DC REIT, Keppel Ltd, Mapletree Pan Asia Commercial Trust, Mapletree Industrial Trust, Mapletree Logistics Trust, Oversea-Chinese Banking Corporation, SATS, Singapore Technologies Engineering, SingTel, Thai Beverage, Wilmar International, Yangzijiang Financial, Yangzijiang Shipbuilding, Seatrium Limited, and SembCorp Industries, all demonstrated varied performances.
Wall Street's lead is strong, as the major averages started the day on a high note and remained positive throughout, ending near session highs. The Dow surged 507.24 points or 1.19 percent to finish at 43,089.02, the NASDAQ rallied 281.56 points or 1.43 percent to close at 19,912.53, and the S&P 500 improved 67.01 points or 1.11 percent to end at 6,092.18.
The strength on Wall Street is due to the announced ceasefire between Israel and Iran as well as the absence of significant negative factors influencing markets. However, the Federal Reserve Chair's comments regarding the central bank's plans to remain on hold despite pressure to lower interest rates were largely disregarded by traders.
Traders generally ignored concerns related to the U.S. economic front, such as the deterioration of consumer confidence in June.
In East Asia, China's economic recovery is anticipated to continue in the second half of 2025 due to policy support, domestic demand rebound, and manufacturing improvements. Simultaneously, Japan's business activity reached a four-month high in June, with services and manufacturing sectors both experiencing growth, albeit constrained by weak foreign demand and lingering tariff uncertainties.
The easing of US-China trade tensions offers some stability for Asian markets, but uncertainty remains due to ongoing macroeconomic factors like trade policies, currency movements, and global economic instability. However, long-term recovery in China and positive developments in Japan support market optimism in the latter half of 2025.
In summary, the outlook for Asian markets after the ceasefire is cautiously optimistic but influenced by a combination of global macroeconomic factors and uncertainties. Despite temporary positivity, Asian markets remain sensitive to broader economic factors such as trade policy shifts, currency fluctuations, and domestic economic conditions.
Taking the positive close of the Singapore stock market on Tuesday into account, investors may consider reinvesting in the stock-market on Wednesday, given the anticipated higher opening. With the STI hovering above the 3,900-point threshold after a marginal increase on Tuesday, financial shares within the index could be a potential investment area. The global context, such as the optimistic market forecast for Asia, the announced ceasefire between Israel and Iran, and the strong lead from Wall Street, further enhances the potential for investing in the stock-market.
