Markets buoyant on positive news from US, China

But conflict in Middle East, looming US election could trigger volatility

- Ven Sreenivasan

Despite heightened geopolitical concerns, global risk equities continued to rise last week, thanks to positive news flows from the world's two largest economies.

Following China's surprise roll-out of a huge stimulus package to jump-start an ailing economy and boost consumer spending a week ago, the latest jobs data from the US released on Oct 4 suggests that the world's biggest economy remains robust, with no signs of slowing.

On Wall Street, the Dow Jones Industrial Average ended the week at a record high of 42,352.75 points, after edging up 0.09 per cent for the week. The S&P 500 rose 0.22 per cent for the week to 5,751.07 points, bringing its year-to-date gain to 19.6 per cent. Meanwhile, the tech-heavy Nasdaq was up 0.1 per cent to 18,137.85 points.

The Straits Times Index (STI) has done relatively well over the past month, with the index hitting a 17-year high on Sept 23, led by banks, airline technology and Singapore real estate investment trusts (S-Reits). The benchmark index held on to its gains and ended the week 0.3 per cent higher at 3,589.13, keeping within the Sept 24 high of 3,652.62 points and Sept 27 low of 3,559.86 points in recent weeks as institutions were net buyers in local stocks.

The star performer for the week on the STI was Seatrium, with a 15 per cent gain to a six-month high of $1.99 on Oct 4 as global oil prices spiked amid rising tensions in the Middle East. However, the share price is still some distance off the Bloomberg consensus estimate target price of $2.57.

Analysts remain upbeat on the prospects for S-Reits amid signs that interest rates are headed lower.

Phillip Capital noted that despite the recent rally, S-Reits are still down 2 per cent in 2024.