Singapore shares little change despite US Fed's more hawkish stance

Local stocks ended flat as investors digested news of the Singapore central bank's move to ease monetary policy with the United States Federal Reserve's more hawkish stance. -- PHOTO: ST FILE
Local stocks ended flat as investors digested news of the Singapore central bank's move to ease monetary policy with the United States Federal Reserve's more hawkish stance. -- PHOTO: ST FILE

SINGAPORE - Local stocks ended flat as investors digested news of the Singapore central bank's move to ease monetary policy with the United States Federal Reserve's more hawkish stance.

The benchmark Straits Times Index closed at 3,419.05, a dip of just 0.1 point on Thursday.

Stocks had dropped at the start of trade and fell by as much as 17 points before climbing back up to positive territory by midday.

Shares then stayed in the black for most of the afternoon, up by as much as nine points, before the final half an hour of trade where investors took flight again after European markets opened lower.

The Monetary Authority of Singapore's surprise move to slow the appreciation of the Singapore dollar gave a boost to the market on anticipation of higher growth due to a weaker currency.

That was however tempered by fears of a rate hike in the US, where the Fed was seen by analysts to have taken a more hawkish stance by painting a brighter outlook of the economy.

The Fed's first monetary statement for the year, issued at the end of a two-day meeting on Wednesday, described job gains as being "strong" instead of "solid" while activity was upgraded to "solid" from "moderate".

More worryingly for markets, it dropped its pledge to keep rates low for a "considerable time", though it said it would be "patient" in normalising its monetary stance.

Asian bourses fell substantially across the board after Wall Street saw a 1.1 per cent decline on the Dow Jones Industrial Average and a 1.4 per cent drop on the S&P 500.

Hong Kong and Tokyo both surrendered 1.1 per cent, Shanghai decreased 1.3 per cent and Seoul lost 0.5 per cent.