Market Summary at 17th November 2012

Singapore shares ended flat on Friday, surrendering gains in the closing minutes of trading after rising on bargain hunting.

Shares started weaker in early trading, after the government reported Singapore's gross domestic product contracted 5.9% in the July-September period from the previous quarter on seasonally adjusted, annualized terms, sharper than an October estimate of a 1.5% contraction. Although the Straits Times Index rose to an intraday high of 2,954.42 as investors sought bargains, the benchmark index ended 0.01%, or 0.29 point, lower at 2,945.63. Volume fell to 1.48 billion shares from 2.66 billion on Thursday, and gainers outnumbered losers 209 to 183.

The benchmark ended the week 2.1% lower.

However, some analysts said the Singapore stock market has likely bottomed. "Obviously, markets rightfully fear a number of crash-inducing events now, including the U.S. fiscal cliff, a euro-zone breakup, and a China hard-landing," CIMB said in a note. However, "markets have a habit of proving its worst fears, or its worst hopes, unfounded though. The fact that all these are expected means that it is unlikely to happen; if anything were to trigger a major crash, it has to be something not expected now." Several economists say they expect U.S. politicians to reach a deal by the end of the year to avoid sharp tax increases and spending cuts, popularly known as 'fiscal cliff.'

Fraser & Neave was the top performer, gaining 1.6% to close at 9.28 Singapore dollars (US$7.58) as rival Thai and Indonesian tycoons battled for the beer-to-real estate conglomerate. Thai billionaire Charoen Sirivadhanabhakdi's TCC Assets, which has submitted a bid for Fraser & Neave, is considering all options--including raising its offer--after Overseas Union Enterprise, controlled by Indonesia's Riady family, made a counter offer for the company Thursday, according to people with knowledge of the deal.

Stocks of several other companies that had been battered earlier this week clawed back. Wilmar International added 1.3% to close at S$3.16 after losing 1.6% earlier in the week and Noble Group gained 1% to close at S$1.06. However, Golden Agri-Resources closed 2.4% lower at S$0.60, as investors buying the stock now won't be eligible for dividend payment.

Global Logistic Properties was the biggest decliner among benchmark shares, shedding 2.7% to S$2.52 amid signs of economic trouble in Japan and China, which are its main markets.