Singapore shares rise on lower US inflation, rate-cut possibility; STI up 0.5%

SINGAPORE shares ended higher on Thursday (Jun 13), as markets were encouraged by easing US Consumer Price Index (CPI) figures and the possibility of more interest-rate cuts by the US Federal Reserve.

The benchmark Straits Times Index (STI) rose 0.5 per cent or 17.09 points to 3,324.53.

Across the broader market, gainers beat losers 334 to 238 with 1.3 billion securities worth S$858.1 million having changed hands.

Regional markets put up a mixed showing on Thursday. Japan’s Nikkei 225 shed 0.4 per cent, while both Hong Kong’s Hang Seng Index and South Korea’s Kospi gained 1 per cent.

In a research note published on Thursday, DBS analysts said that the lower-than-expected May CPI reading in the US overnight was another encouraging data point that showed progress on disinflation.

Furthermore, Federal Reserve chairman Jerome Powell hinted that the CPI reading was not reflected in the Fed’s projection of one interest rate cut this year, and that it was still open to making two cuts this year, they noted.

“Support for a ‘high-for-longer’ backdrop from index heavyweight banks may prove to be temporary, should subsequent inflation or employment data points affirm the path towards disinflation, and open the possibility of a second rate cut this year,” the analysts added.

On the STI, Yangzijiang Shipbuilding was the top performer, rising 1.7 per cent or S$0.04 to S$2.45.

Thai Beverage was at the bottom of the table, falling 2 per cent or S$0.01 to S$0.48.

The three major banks were in the black. UOB gained 0.5 per cent or S$0.14 to S$30.79, OCBC gained 0.5 per cent or S$0.07 to S$14.30, and DBS rose 0.5 per cent or S$0.19 to S$35.84.