Bulls And Bears

STI ends weaker for third straight day

Traders uninspired with US Fed split on pace of interest rate rises, sluggish crude prices

The slide downhill continued for local equities yesterday while markets in Asia again turned in a mixed performance.

The benchmark Straits Times Index (STI) fell 10.07 points, or 0.31 per cent, to 3,268.88 - its third straight day in the red, with a total of 1.05 billion shares worth $1.09 billion traded across the bourse.

Elsewhere, Tokyo eased 0.14 per cent and Hong Kong, 0.24 per cent, but Shanghai added 0.68 per cent and Seoul , 0.57 per cent.

Traders in the region were largely uninspired after the United States Federal Reserve's latest meeting showed members divided on the pace of interest rate rises. A slide in crude oil prices did little to help.

Ms Margaret Yang, CMC Markets Singapore market strategist, noted that "sluggish oil prices are likely to deliver a negative impact on the energy sector... and place Singapore's oil and gas companies in a more difficult situation".

She cited the recent trading suspension of Ezion Holdings - now in discussions with its stakeholders and creditors - which "reminded investors of several troubled oil and gas companies, namely Swiber, Ezra and Nam Cheong, all of whom were deeply trapped by huge debts and shrinking business due to low oil prices".

Indeed, energy-related counters here took a hit yesterday. Sembcorp Industries dropped 1.7 per cent or five cents to $2.96, while its marine arm Sembcorp Marine declined 0.6 per cent or one cent to $1.575.

Keppel Corporation lost 0.6 per cent or four cents to $6.33.

The group said in the morning it had signed a sale and purchase agreement, together with Golar LNG and Black & Veatch, to sell an equity interest in Golar Hilli to a unit of Golar LNG Partners for US$658 million (S$899 million), less net lease obligations.

Among the three local banks, DBS Group Holdings stood out with a 0.7 per cent or 14 cent rise to $20.53, while United Overseas Bank sank 0.5 per cent or 13 cents to $23.60, and OCBC Bank shed 0.4 per cent or five cents to $11.14.

The banks have been hammered recently on renewed fears over their exposure to the beleaguered oil and gas sector.

Other laggards included transport group ComfortDelGro, which slumped 3.1 per cent or seven cents to $2.17, and Hutchison Port Holdings Trust, down 2.5 per cent or 1.5 cents to 59 cents.

Outside of the STI, oil exploration and production firm Loyz Energy leapt 5.3 per cent or 0.1 cent to two cents after it delivered a net profit of US$11.4 million in the fourth quarter, marking a full year back in the black.

The day's most traded stock was real estate firm Rowsley. It gained 3.9 per cent or 0.4 cent to 10.7 cents on 115.9 million shares done. Other actives included Advanced Systems Automation, unchanged at 0.1 cent, and mDR, also flat, at half a cent.

A version of this article appeared in the print edition of The Straits Times on August 18, 2017, with the headline 'STI ends weaker for third straight day'. Print Edition | Subscribe