SINGAPORE shares closed 0.58 per cent lower on Monday, losing earlier gains despite a US government plan to buy mortgage-related assets at the root of a global financial crisis, dealers said.

They said initial investor optimism over the bailout turned to pessimism.

The blue-chip Straits Times Index (STI) fell 14.94 points to 2,544.13.

The index had risen more than one percent in early trade.

Around 1.5 billion shares exchanged hands.

Losers beat gainers 276 to 260 -- AFP