Asian stocks retreat on China data fears, STI sheds 11 points

SINGAPORE - Asian stocks retreated on Monday as traders treaded cautiously ahead of fresh Chinese economic data to be released this week.

The Chinese markets, which resumed trading after being closed last Thursday and Friday for a public holiday, continued to be plagued by worries over the country's slowing growth. Shanghai fell 2.52 per cent after a volatile session, despite assurances by China's central bank governor over the weekend that both the stock markets and the yuan should see stabilisation in the coming weeks.

Hong Kong slipped 1.23 per cent, although Japan bucked the trend with a 0.38 per cent gain. The selldown in Wall Street on Friday, with the Dow Jones Industrial Average sliding 1.66 per cent after August non-farm payroll figures in the United States missed expectations, did little to lift sentiment here as well.

"The key focus this week would be China as the market reopens," Mr Michael McCarthy, chief market strategist at CMC Markets in Sydney, told Bloomberg.

"Investors are increasingly concerned about the slowdown in the Chinese economy."

In Singapore, the benchmark Straits Times Index (STI) shed 11.4 points, or 0.4 per cent, to 2,852.41.

IG market analyst Bernard Aw noted that the STI was affected by the largely risk-off appetite, although "good support" was sighted at the 2,850 level.

"Further signs of stability in the global markets will strengthen the support at this level," he said.

Monday's losses were led by commodity plays, as the sector continues to sink into the doldrums. Agri-business group Wilmar International was the day's biggest loser, falling 11 cents or 4 per cent to $2.63, while commodities trader Noble Group dropped one cent or 1.9 per cent to 51.5 cents. Palm oil giant Golden Agri-Resources slipped half a cent or 1.67 per cent to 29.5 cents.

Olam International, which will be dropped from the STI component stock line-up from Sept 21, continued to head south, dipping two cents or 1.01 per cent to $1.96.

Local lenders OCBC Bank and DBS Group also fared poorly. OCBC Bank pared three cents or 0.34 per cent to $8.83, while DBS Group dipped six cents or 0.34 per cent to $17.44.

United Overseas Bank closed flat at $19.15.

Aircraft maintenance and repair company SIA Engineering Company was among the day's few gainers, climbing six cents or 1.8 per cent to $3.46.

Outside of the blue chips, social e-commerce firm YuuZoo Corporation jumped one cent or 7.5 per cent to 14.4 cents, bolstered by news of its $30 million funding facility for the next three years from New York-based private alternative investment group GEM Global Yield Fund.

Airport solutions provider Stratech Group was the most active stock, with 65.1 million shares being traded. It closed flat at 5.9 cents.

Overall trade on the exchange came in at a lackluster $833.7 million, with 840 million shares changing hands.

Trading will be closed on Friday, when Singapore goes to the polls.

tsjwoo@sph.com.sg