Local stocks headed south for the second straight day yesterday, even though other markets in the region rose as jitters over geopolitical tensions subsided. The Straits Times Index (STI) slid 6.89 points, or 0.24 per cent, to 2,884.69, paring earlier gains made during morning trade.
This was little helped by fresh figures for the country's manufacturing output, which fell 5.4 per cent year-on-year last month, weighed down by a 14 per cent drop in electronics production. The fall had come in slightly above market expectation of a 5.3 per cent decrease, according to a Reuters poll.
The STI's muted performance tracked Hong Kong and Shanghai, which retreated 0.04 per cent and 0.3 per cent respectively.
Analysts believe that traders remain cautious as the spotlight returns to the interest rate hike in the United States, expected next month.
"Investors may also hold back trade ahead of the year-end holidays," said broker Krungsri Securities in Bangkok, in a Reuters report.
"Eyes are on the European Central Bank meeting, and the release of key US indicators next week, which could affect the Fed's decision at the Dec 15 to 16 meeting."
Markets elsewhere mostly stabilised as fears over Turkey's downing of a Russian fighter jet abated, with Tokyo gaining 0.5 per cent to reach a three-month high.
Seoul rebounded 1.1 per cent, Jakarta added 0.3 per cent and Sydney climbed 0.3 per cent.
Wall Street was little changed on Wednesday, creeping up 0.01 per cent following mixed economic data. US markets were closed yesterday for Thanksgiving Day.
At home, the losses were led by the local lenders, with OCBC Bank losing eight cents or 0.9 per cent to $8.72. Volume was a hefty 14.8 million units worth $129.4 million.
United Overseas Bank dropped 35 cents or 1.8 per cent to $19.25, while DBS Group Holdings dipped six cents or 0.4 per cent to $ 16.66.
Nomura noted in a report that the coming year should see investors' focus on local banks shift to growth from asset quality as non-performing loans peak. It also expects earnings to grow 12 per cent on the back of higher interest rates.
Commodity giant Noble Group kept tumbling, falling half a cent or 1.3 per cent to 39.5 cents. It was the most heavily traded stock, with 74.3 million shares changing hands.
Singtel rebounded, rising one cent or 0.3 per cent to $3.81. Container port business trust Hutchison Port Holdings Trust rose one cent or 1.3 per cent to 76 cents.
Catalist-listed cord blood bank Cordlife Group advanced for the second day, rising 2.5 cents or 1.9 per cent to $1.345. The firm, in response to a Singapore Exchange query on unusual trading activity in its stock, had confirmed on Wednesday it is considering opportunities relating to acquisitions, divestments and joint ventures. It added that no definitive agreement has been signed yet.