BULLS AND BEARS
6.57% jump is biggest one-day percentage rise, but some dealers expect more volatility ahead
BY LEE SU SHYAN
ASSISTANT MONEY EDITOR
WHAT a difference a weekend can make. After last week's vicious plunges and huge losses, yesterday's head-spinning surge seemed like a gift from another world.
The 6.57 per cent gain – or 128.02 points – was the largest one-day percentage increase for the Straits Times Index (STI) since 1999, the earliest date for historical figures for the revamped STI.
All stocks in the STI rose except for Jardine Cycle & Carriage, which lost two cents to $9.97, probably because of its links to Indonesia.
The local banks chalked up solid gains in line with the STI.
United Overseas Bank was 90 cents higher at $15.70, DBS Group Holdings gained 86 cents to $14.86 while OCBC improved 26 cents to $6.42.
Jardine Matheson leapt US$1.50 to US$23.
Property counters all saw gains. Yanlord Land was up 9.5 cents to 90 cents, Keppel Land added 21 cents to $2.01, City Developments surged 72 cents to $7.20 and CapitaLand gained 22 cents to $2.73.
Still, despite the exhilarating surprise for the market, some dealers feel investors are not out of the woods yet.
Mr Najeeb Jarhom, senior vice-president of research from Amfraser Securities, warned that downward volatility may not be over although yesterday's action did show that the STI had managed to pick itself up to end above the 2,000 psychological level.
This came after the index tested lows of 1,945 on Friday and yesterday when it hit an intra-day low of 1,945.55 in mid-morning.
Mr Jarhom thinks that even getting to the 2,080 to 2,160 band will not be a smooth ride.
But that will still be a small recovery compared to last Friday, when the STI ended at 1,948.33. That represented a 49.3 per cent plunge from last Oct 11's peak of 3,831.
Among the actives yesterday, palm oil player Golden Agri-Resources inched up half a cent to 24 cents with 161.5 million shares traded. Its 2.1 per cent rise was less than the STI's improvement.
Yesterday, Goldman Sachs put out a report saying that the weaker economic outlook reduces demand for commodities including palm oil.
The second most actively traded was Gallant Venture, which is a master planner for industrial parks in Batam and Bintan.
It traded 3.5 cents lower at 31 cents, with 61.9 million shares traded, again, likely a victim of the uncertainty over Indonesia's markets.
The third most active was China Hongxing Sports, which improved by 2.5 cents to close at 21.5 cents with 53.6 million shares traded.
Yesterday's volume of 1.59 billion shares worth $1.62 billion continues to be above average.