singapores straits times index corrects after a four session winning streak 1678152015

Regional markets traded bearishly Tuesday.

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By :  ,  Financial Analyst

Shares on the Singapore exchange slipped nearly 1 per cent in Tuesday’s trading, led by sharp falls in big banks as well as marine engineering companies, and weakness in regional stock exchanges.

The benchmark Straits Times Index finally corrected after four successive winning sessions, as investors chose to lock in some profits and stay on the sidelines pending the conclusion of the US Fed’s monetary policy meeting.

Amongst the banks, DBS Group Holdings Ltd (SGX:D05) fell 1.61 per cent to SG$17.72, United Overseas Bank Ltd (SGX:U11) was down 1.27 per cent to SG$20.27 and Oversea-Chinese Banking Corp. Limited (SGX:O39) lost 1.59 per cent to SG$9.28.

Keppel Corporation Limited (SGX:BN4) fell 1.11 per cent to SG$7.12,  Sembcorp Marine Ltd (SGX:S51) dipped 3.32 per cent to SG$2.33 and Ezra Holdings Limited (SGX:5DN) slumped 2.36 per cent to SG$0.12 as investors sold off engineering companies due to their poor earnings reports.

Indices and Sectors

The Straits Times Index (STI) ended 30.54 points or 0.99 per cent lower at 3,052.53, taking the year-to-date performance to -9.29 per cent.

The FTSE ST Mid Cap Index declined 0.73 per cent, while the FTSE ST Small Cap Index declined 0.80 per cent.

The Singapore Exchange traded a volume of 1,322.5 million shares valued at SG$953.5 million. Losers outnumbered gainers by 285/132.

The losing sectors included basic materials (-2.07 per cent), Catalist index (-1.78 per cent), oil and gas (-1.48 per cent), telecommunications (-1.45 per cent) and consumer goods (-1.26 per cent). The sole gaining sector was consumer services (+0.25 per cent). 


Multimodal transport operator SMRT Corporation Ltd. (SGX:S53) said that during the second quarter ended September 30 its earnings grew 1.9 per cent to SG$25.7 million while revenue rose 4.7 per cent to SG$328.8 million. Better revenue from non-fare operations helped offset losses in the transit business, the Straits Times said.

CapitaLand Limited (SGX:C31) gained 0.3 per cent to SG$3.18. One of its units has entered a joint-venture arrangement with a Vietnamese company for the development of a prime residential site in Ho Chi Minh City which will be Capitaland’s sixth residential project at that location. The US$55 million (SG$76.7 million) project will span about 1 hectare and comprise 350 units.

Grand Banks Yachts Ltd (SGX:G50) reported a net profit of SG$1.2 million during the first quarter ended September 30 compared to a net loss of SG$1.3 million in the prior year period. The company said its gross profit margin jumped 24.5 per cent from 9.5 per cent a year ago as a result of the restructuring efforts after a major acquisition, as reported by MarineLink. Mark Richards, Chief Executive Officer of Grand Banks, said, “Having completed the bulk of our integration initiatives, we have built a new foundation to strengthen design, production, communication, and internal efficiencies.”

According to the Business Times, Keppel Offshore and Marine and Sembcorp Marine Ltd (SGX:S51) are considering a foray into LNG shipbuilding based on an expected increase in small-scale liquefied natural gas activity.

Starhill Global Real Estate Invmt Trust (SGX:P40U) said that distribution per unit grew 3.1 per cent to 1.31 Singapore cents during the first quarter ended September 30. Revenue grew 16.8 per cent to SG$56.8 million, while net property income jumped 10.2 per cent SG$43.6 million. The improved results came on the back of contributions from a recently purchased mall in Adelaide as well as from the Singapore portfolio, though China and foreign currency movements were a drag on the results.

OSIM International Ltd. (SGX:O23), the maker of healthy lifestyle products, reported a 62 per cent decline in net profit in the third quarter ended September 30 on the back of soft retail sales and volatile currency and financial markets. While earnings for the quarter were SG$6 million, down from SG$10 million a year ago, revenue plunged 11 per cent to SG$142 million, the Straits Times said.

Effective December 1, the Singapore Exchange will widen its rule relating to the recording of transactions with parties who are privy to these deals. Instead of preparing a list for only ‘significant’ transactions, such as takeovers or major acquisitions, companies will now be required to maintain such lists for all material transactions, the Straits Times reported.

Economic news

In its biannual macroeconomic review released yesterday, the Monetary Authority of Singapore said that global growth prospects had softened over the past six months, and the resulting impact on Singapore’s key foreign trade partners was exacerbating the uncertain outlook for Singapore’s economy. Accordingly, MAS said it expected a modest growth rate in the range of 2-2.5 per cent for Singapore this year and a similar range for next year, the Straits Times reported. MAS justified its decision this month to slightly reduce the Singapore dollar's rate of appreciation on the grounds that more aggressive action “was clearly unwarranted, as the Singapore economy was neither experiencing an outright retraction in economic activity nor widespread price declines.”

On Wall Street Tuesday, stocks ended lower after investors were concerned over the uncertainty regarding US interest rates and disappointed by results from big companies such as Ford. Though Apple Inc. (NASDAQ:AAPL) was down 0.6 per cent to SG$114.55 in the regular trading session, in after-hours trading, the stock was up 2.8 per cent in response to a solid earnings report from the company. The Dow Jones Industrial Average fell 41.62 points, or 0.24 percent, to 17,581.43, the S&P 500 lost 5.29 points, or 0.26 percent, to 2,065.89 and the Nasdaq Composite dropped 4.56 points, or 0.09 percent, to 5,030.15.

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