Singapore shares open higher despite tensions over Iran deal

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Singapore shares opened slightly higher on Wednesday, despite a spike in geopolitical tensions and oil volatility after U.S. President Trump pulled out of the Iran nuclear deal.

The Straits Times Index was up 0.013 percent at 3543.63 at 9:52 A.M. SGT.

“The much awaited Iran nuclear deal decision ignited little reaction with the expectation having been priced in, although the energy sector certainly still looks up at the moment,” Jingyi Pan, market strategist at IG, said in a note on Wednesday.

Nymex WTI crude futures were up 2.20 percent at US$70.58 a barrel at 9:44 A.M. SGT and Brent ICE futures were up 2.36 percent at US$76.62 at 9:44 A.M. SGT, according to Bloomberg data.

Stephen Innes, head of Asia Pacific trading at OANDA, said in a note on Tuesday that he expected more volatility in oil markets after an “extremely volatile” session in the U.S., which saw prices whipsaw on the Iran news.

While he said that much of the U.S. unilateral move on Iran was factored in, the market faces a “delicate supply balance narrative” between robust global demand, Venezuelan adversity and Saudi Arabia’s desire to push up prices further.

“Even without Iran sanctions, oil prices will remain firm,” he said.

Singapore’s oil-related shares were higher, with Keppel Corp up 1.12 percent at 10:03 A.M. SGT and Sembcorp Marine up 2.39 percent.

Ezion, however, was flat after issuing a profit warning, saying in a filing to SGX after the market close on Tuesday that it expected to report a net loss for the first quarter.

F&N was up 1.97 percent after reporting its fiscal second quarter profit after tax rose 63 percent on-year to S$36.3 million as revenue increased 5 percent on-year to S$473.1 million on broad-based sales growth.