STI resilient in face of headwinds
Local market weighed down by worse-than-expected retail sales growth in April
Singapore equities picked up from where they left off on Tuesday, on the up, before the weight of US-China trade concerns - lingering in the background after the recent rally - and protests in Hong Kong dented investor sentiment.
The Straits Times Index (STI) eventually closed at 3,207.74, down 1.84 points or 0.06 per cent, with CMC Markets analyst Margaret Yang noting that the index "demonstrated resilience against multiple headwinds".
On Tuesday, US President Donald Trump said he was responsible for holding up a trade deal with China, adding that the US would either have a "great deal" with China or none at all, before continuing to place criticism on the US Federal Reserve for not cutting interest rates.
The local market also had to contend with worse-than-expected retail sales growth for April and private sector economists lowering Singapore growth forecast to 2.1 per cent for 2019, closer to the middle of the Ministry of Trade and Industry's official forecast range.
"The tepid economic outlook suggests that corporate earnings growth in Q2 might not deliver much of positive surprise to investors, and trade uncertainties will likely dampen hiring, investment and capital expenditure for a prolonged period of time," Ms Yang said.
Australia, China, Hong Kong, Japan and Malaysia all closed lower. Unsurprisingly, the Hang Seng Index performed the worst of the lot, sliding 480.88 points or 1.7 per cent to finish at 27,308.46.
Tensions are running high in the territory, with protests aimed at preventing the passage of an extradition Bill.
Mr Stephen Innes, a managing partner at Vanguard Markets, said: "The demonstrations in Hong Kong regarding the extradition Bill provided much of the news flow in Asia and frankly, for me, they overshadowed most of the goings-on in Asian financial markets."
The impact of the protests were most felt on Singapore-listed counters with considerable exposure to Hong Kong.
These include blue chip index stocks Hongkong Land (down 20 US cents, or 27 Singapore cents, or 2.9 per cent to US$6.63) and Jardine Strategic Holdings (down 39 US cents or 1 per cent at US$37.71).
Trading volume here clocked in at 1.15 billion securities and turnover came to $1 billion. Both figures were 96 per cent of their respective daily averages in the first five months of this year.
Across the market, decliners outpaced advancers 218 to 146. The STI had 14 of 30 components in the red.
On 27.7 million shares traded, Genting Singapore remained the benchmark index's most traded stock for the third straight session. The casino operator dipped one cent or 1.1 per cent to close at 88.5 cents.
Among the banks, DBS Group Holdings closed two cents or 0.1 per cent higher at $24.70 and United Overseas Bank added eight cents or 0.3 per cent to $24.61. Meanwhile, OCBC Bank ended at $10.80, down one cent or 0.1 per cent.
With markets still anticipating the Fed to announce rate cuts in the coming months, investors continued to load up on real estate counters though interest was less pronounced than days prior.
OUE added one cent or 0.7 per cent to $1.50 and City Developments advanced 16 cents or 1.8 per cent to $9.19.
Mapletree Logistics Trust, which added three cents or 2 per cent to $1.56, and Ascott Reit, which gained two cents or 1.6 per cent to $1.30, were some of the gainers among real estate investment trusts.
"The one strong support for the market right now is the prospect of Fed cuts into the second half of the year," IG market strategist Pan Jingyi said.
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