THE closure of the Hong Kong market for a public holiday yesterday meant that the local market was mainly left to run on its own steam and in this regard, it turned in a disappointing performance - stocks mainly drifted in low volume throughout the day. The Straits Times Index's movements displayed all the hallmarks of a market unsure of what to do next while lacking in direction when it traded within a tight band before ending a nett 1.28 points higher at 2,716.62.

Turnover excluding foreign currency issues was 1.3 billion units worth $952 million, compared with the $1.6 billion daily average of last week. Excluding derivatives, there were 170 rises versus 221 falls in the entire market. Nowhere was the closure of Hong Kong felt more than in the warrants segment, which managed only $8 million worth of business compared with the already-low daily averages of $20-30 million seen in recent weeks.

The day's most actively traded stock was life sciences counter Transcu Group, which dropped one cent to 12 cents with 84 million units traded. The stock has fallen from around 20 cents since local broker UOB-Kay Hian imposed trading curbs on it last week.

Meanwhile, CIMB maintained an 'overweight' on the property sector yesterday on the basis that indicators such as the Q3 resale and rental figures still look promising, while within the sector, UBS Investment Research in a Oct 23 report called a 'buy' on CapitaLand with a $4.75 target, largely because of the company's impending listing of its retail malls under CapitaMalls Asia (CMA).

'CMA has a book value of $5.3 billion. Our sensitivity analysis shows that every 0.1x above NAV (net asset value) achieved in the IPO process adds 12 cents to CapitaLand's $4.30 RNAV (revalued NAV). If CMA's assets are valued at $8-10 billion, CapitaLand's RNAV would increase to $4.91-$5.36,' said UBSIR.

CapitaLand yesterday rose eight cents to $4.43.

In the tech sector, shares of Chartered Semiconductor ended unchanged at $2.63 after the company last week reported its Q3 results.

UBSIR maintained a 'sell', saying that it believes shareholders will accept the $2.68 that takeover offeror ATIC has tabled and said that it does not think there will be any issues that could affect the offer.

Daiwa Securities, on the other hand, in rating Chartered a 'hold', said that minority shareholders should reject the offer and hold on to the stock for one more year for a better offer from ATIC because the offer price considers only replacement value and does not take into account intangibles such as customer access.

In its latest chart view, DMG & Partners said that the outlook is optimistic for the STI. 'We believe that the direction of STI remains positive - the MACD chart is still depicting a bullish picture, while the present Wave 5 that the STI is currently riding on should continue to translate to further price gains. Given the bullish outlook, our recommendation for investors to be underweight cash and overweight equities thus remains, although we believe that market interest would be skewed towards the bigger-cap plays.'

DMG said that initial resistance is at 2,763 and second resistance is at 2,830. Support is at 2,663-2,668.

DBS-Vickers in the meantime, said that there is no change in its market view that the STI should remain capped at 2,800 for the rest of this year. 'A pullback to either 2,600 or even 2,400 is possible before the major uptrend resumes. Our current fundamental 12-month STI target is 3,160,' said DBSV.