STI opens flat as Asia markets return to calm after global storm

SINGAPORE - Singapore shares dipped 1.79 points on opening as calm returned to markets in Asia after Thursday's global rout.

While other Asian markets opened tentatively higher, the Straits Times Index was trading 0.06 per cent lower at 3,152.42 as of 9:07am after news on Friday morning that Singapore's non-oil domestic exports rose 0.9 per cent in September from a year earlier, missing expectations, as shipments to Europe contracted.

The MSCI Asia Pacific Index climbed 0.1 per cent to 134.93 as of 9:01 a.m. in Tokyo after a top Federal Reserve official said the US central bank should consider delaying ending its bond-buying programme and U.S. data eased concern over the world's largest economy.

The STI tumbled 44.51 points, or 1.39 per cent, losing all its gains for the year in a global market selloff.

US and European equity markets settled down Thursday after days of upheaval driven by fears of global economic weakness, although anxiety remained high.

US stocks finished the session little changed, rallying from deep losses during the morning hours that pushed the major indices close to the 10 per cent pullback that qualifies as a full-blown correction. Leading European indices followed a similar path, with the German DAX fighting back into positive territory and bourses in Paris and London cutting the worst of their losses following rollercoaster sessions.

The Dow Jones Industrial Average sank more than 200 points, while the Nasdaq Composite Index teetered into correction territory after disappointing results from Netflix tainted one of the tech-rich index's biggest stars. In the end, the Dow declined 24.50 (0.15 per cent) to 16,117.24, while the broad-based S&P 500 edged up 0.27 (0.01 per cent) to 1,862.76. Nasdaq gained 2.07 (0.05 per cent) to 4,217.39.

Investors took heart from a two sets of US data that showed the economy was still going strong - a 1.0 per cent gain in US industrial production in September and a drop in weekly jobless claims to a 14-year low. Analysts also cited comments from James Bullard, head of the St Louis branch of the Fed, who suggested the central bank could extend its bond-buying program rather than winding it down, as had been expected.

In one of the day's more closely watched earnings announcements, Delta Air Lines offered a bullish forecast for the fourth quarter and expressed confidence that Ebola would not significantly affect airline travel.

ann@sph.com.sg