Asian markets in disarray over US Fed, BOJ interest rate decisions, STI down 12 points

Singapore Exchange Centre at Shenton Way.
Singapore Exchange Centre at Shenton Way. ST PHOTO: LIM YAOHUI

SINGAPORE - Asian markets had a a rollercoaster ride on Thursday with sentiment torn between policy decisions made by two of the world's biggest central banks.

While the United States Federal Reserve meeting market expectations by opting to delay an interest rate hike, the Bank of Japan also kept rates steady, surprising regional investors who wanted to see more easing for the stagnant economy.

This led to afternoon losses that wiped off early gains across the region. Singapore's benchmark Straits Times Index opened at 2,892 and rose to as high as 2,900 but closed down 12.42 points or 0.43 per cent at 2,862.30.

Turnover was livelier, however, with 1.36 billion shares worth S$975.5 million transacted across the whole market.

Elsewhere in Asia, Shanghai dropped 0.27 per cent, Hong Kong rose a marginal 0.12 per cent and Kuala Lumpur was down by 1.04 per cent. Tokyo was unsurprisingly the top loser, shedding 3.61 per cent, while the Japanese yen shot up 3 per cent against the US dollar, its largest jump since August last year.

Remisier Alvin Yong said: "The market disarray showed that perhaps the case for more easing measures has been over-estimated.

"From here on, I think STI will stay range-bound below 2,960. Earnings are the key focus after the central bank events, and so far the figures have not offered any pleasant surprise."

The biggest results announcement was by the United Overseas Bank, whose first quarter net profit dropped 4.4 per cent but was still in line with analyst expectation.

UOB closed down three cents or 0.16 per cent at S$18.85, one of the 16 STI constituents that ended lower Thursday. OCBC, which reports its results on Friday, pared nine cents or 1 per cent to S$8.90, and DBS dropped 16 cents or 1.03 per cent to S$15.44.

Genting Singapore, which showed further weakness in its gaming business after announcing last week the liquidation of a Macau subsidiary set up for a casino venture there, dropped two cents or 2.35 per cent to 83 cents, with 24.2 million shares traded.

On the other end of the spectrum, Sembcorp Marine rose 1.5 cents or 0.9 per cent to S$1.685.

whwong@sph.com.sg