DESPITE concerns over the impact of the economic slowdown in China, the eurozone debt crisis and the anaemic economic growth in the United States, sentiment on the Singapore market remained relatively robust.
The Straits Times Index (STI) pulled back 13.43 points to 3,015.53 yesterday, weighed down largely by a narrow band of Jardine stable heavyweights, Jardine Matheson, Jardine Strategic, and Jardine C&C. But overall market activity was thin, with just 1.27 billion units worth $1.1 billion changing hands.
The actives list was led by ThaiBev, which rose 2.5 cents to 36.5 cents on 90.8 million shares as activity on the stock picked up in the afternoon. This comes as the Thai brewery's founder, billionaire Charoen Sirivadhanabhakdi, and associate parties bought up significant stakes in Fraser & Neave and its beer-making unit Asia Pacific Breweries. The move has prompted the world's third largest beer-maker Heineken NV - which already controls 42 per cent of APB, to make a counter-offer of $5.1 billion for APB and F&N to buy all the shares it does not already own in these companies.
The counterbid valuing APB at $50, essentially means that ThaiBev makes a $100 million paper gain.
Singapore Exchange's stock, meanwhile, rose 7 cents to $6.75 amid reports that it was headed for a merger with the London Stock Exchange Group. UK's Daily Telegraph reported that the two bourses were discussing a potential £7.2 billion (S$14.2 billion) merger.
The newspaper added that talks were still in their preliminary stages and focused on the benefits of merging the two exchanges amid continued consolidation attempts in the sector.
Clarifying the market rumours, Singapore Exchange said in a statement: "SGX has not engaged in talks with the LSE on a potential merger. However, we are open to collaborations and partnerships which may benefit our shareholders and the company."
Elsewhere, despite the pullback by the index, brokers said sentiment remained relatively buoyant with expectations of more upside for the market as a whole.
One stock which also appears to have suddenly attracted attention is aluminium components extrusion specialist Midas.
The stock was up 2.5 cents at 37 cents after 32 million units changed hands amid expectation that the Chinese railways authorities are restarting talks on high speed train contracts following a year-long freeze after an accident which killed 40 people in July 2011. Midas, as the biggest maker of the basic coach shells for both high speed and Metro cars in China, is seen as a key beneficiary.
Indeed, having seen the STI punch through the key 3,000- point level, increasing numbers of market insiders reckon the benchmark index will hold up at around current levels, supported by corporate news. On the other hand, turbulence will be injected by newsflows from Europe, China or the US, they added.
Meanwhile, the continued strength on Wall Street is providing support for bourses across the region, and Singapore in particular. Some brokers say Singapore has also been attracting significant amounts of retail funds in recent weeks.
Going forward, individual stock moves will be largely dictated by earnings and corporate developments or news. US stock futures recovered from their lows late heading towards the close of Asian trading time, and most traders here say a fourth positive session on Wall Street would certainly underpin a recovery in sentiment.