SINGAPORE: Singapore shares rallied by midday on Tuesday as traders looked for bargains, with casino operator Genting Singapore outperforming the market on hopes that its earnings may get a boost from the upcoming Chinese New Year.
At 0500 GMT, the Straits Times Index (STI) was up 1.2 percent, or 30.92 points, at 2,677.27. Some 438.1 million shares worth S$317.4 million were traded, compared with 204.3 million shares worth S$213.8 million at the same time on Friday.
The Singapore market was closed for the new year holiday on Monday.
"Stocks have been way oversold. STI was down 17 percent last year and on Friday it was down 1 percent, so we probably have some short-covering," said Carey Wong, an analyst at OCBC Investment Research.
"But this is likely to be more short term because there are still a lot of issues left unresolved, especially in Europe," Wong added.
Underscoring the shaky outlook, Singapore's economy contracted in the last three months of 2011, signalling it may slip into a technical recession as a slump in manufacturing output and slowdown in external demand hurt exports.
Shares of casino operator Genting Singapore jumped as much as 3.3 percent on Tuesday on hopes its earnings for the fourth quarter ended December 2011 may get a boost from the year-end holidays.
The Chinese New Year, which begins on Jan 23, is also expected to lift Genting's business as more people try their luck at the gambling tables.
"This is going to be the Dragon Year, so most likely the first quarter will be very strong. If you look at the Chinese mindset, people think that the dragon is a mystical beast of fortune, so they want to try their luck," OCBC's Wong said.
Shares of Singapore-listed Mewah International, which processes and distributes palm-based products such as edible oils and fats, surged as much as 6.5 percent after it announced its plan to invest around $145 million in Indonesia. At 0500 GMT, Mewah shares were up 5.4 percent at S$0.49 on a volume of 22.5 million shares, 3.4 times the average daily volume in the last 30 days.
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