STI down 8 points, extends losses for third straight day

SINGAPORE - Unabated fears over China's slowing economy pushed Asian shares further south on Wednesday, even as the Chinese markets rebounded slightly.

Japan stocks fell 1.61 per cent, while Hong Kong equities dropped 1.31 per cent to reach its lowest since last December.

This was after China's Commerce Ministry said that exports could continue to fall in coming months, adding to mounting concerns over the country's growth.

The Straits Times Index slid 8.4 points, or 0.28 per cent, to 3,041.25, extending losses for a third straight day this week.

Shanghai stocks, on the other hand, climbed 1.23 per cent, reversing the over five per cent plunge during morning trade.

The central bank completed injecting about US$100 billion (S$140.54 billion) into the financial system, a move aimed at lifting the country's sluggish economy, amid renewed hopes for fresh government support that could shore up the market.

"The market expects the government will step in if the Shanghai Composite falls towards 3,500, but more and more people in the mainland sees that the bull market is over," Ms Mari Oshidari, a Hong Kong-based strategist at Okasan Securities Group Inc, told Bloomberg.

"With weak sentiment, we will continue to see unstable moves in the market."

Ahead of the release of the United States inflation data and minutes of last month's Federal Reserve monetary policy meeting, the losses at home on Tuesday were led by the local banks.

DBS Group lost 12 cents or 0.637 per cent to S$18.71, OCBC Bank shed five cents or 0.526 per cent to S$9.45, and UOB pared nine cents or 0.452 per cent to S$19.820.

IG market strategist Bernard Aw said that traders will be watching closely the release of the minutes, "which ideally should provide greater clarity on the timing of the first (interest rate) hike".

Shipbuilder Vard Holdings slumped four cents or 10.7 per cents to 33.5 cents, hitting a record low. The stock had nosedived by as much as 28 per cent in early morning trading before recovering later, prompting a query from the Singapore Exchange.

Meanwhile, commodities blue chip Noble Group posted its first gain in seven days, edging up one cent or 2.41 per cent to 42.5 Singapore cents.