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Singapore shares rose 0.6% by the midday break on Tuesday, following the regional stock market trend as investors took heart from strong U.S. manufacturing data reported overnight.
Indonesia-based coal miner Straits Asia Resources (STRL.SI) was amongst the outperformers, as concerns that a shortage of coal due to heavy flooding in Australia could lift prices and benefit miners outside of Australia, traders said.
Straits Asia Resources had climbed 1.5% to $2.68 by the lunch break, with over 6.1 million shares changing hands.
Heavy flooding in Queensland, Australia, has caused miners such as Rio Tinto (RIO.AX) to cut coal exports to a trickle.
By the midday break, the Straits Times Index (STI) <.FTSTI> was up 19.73 points at 3,255.50. The total value of shares traded was $1.1 billion, up from $785.7 million in Monday’s morning session.
“The market was fairly quiet in the last few weeks and we’re seeing more interest coming back into the market now after the holidays. Overall, valuations do not look expensive and there is still value in the market,” said Carmen Lee, head of OCBC Investment Research.
Lee said she expects the STI to see some light profit-taking in the next two or three days given its strong gains in the first two trading sessions of the year.
Gains in the STI are likely to be capped at 3,270 this afternoon, traders said.
