BullsAndBears

STI ends day - and week - lower

Property stocks remain in favour, with Bukit Sembawang among gainers in sector

Local shares closed little changed yesterday to end the week lower than where they started.

Focus was on the return of the tech sell-off that saw Snap Inc, the disappearing photo app maker, drop back to its initial public offering price of US$17.

All three major indices in the United States fell overnight.

In the region, Hong Kong's Hang Seng Index managed to eke out a 0.24 per cent gain with liquidity appearing to stay pat as the city's banks looked unlikely to alter the interest rate regime, even as its central bank took a cue from the US and raised rates by a quarter percentage point.

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At home, the benchmark Straits Times Index (STI) shed 0.65 of a point to close at 3,231.44. For the week, the STI lost 22.75 points.

Hongkong Land contributed the biggest losses among the index components while Singtel provided the biggest gains.

In the broader market, gainers outnumbered losers 238 to 190. Some 2.3 billion units worth $1.5 billion were traded - the highest turnover and value posted in a day since May.

Property stocks remained in favour, with analysts eyeing a sector recovery. Bukit Sembawang gained 12 cents or 1.9 per cent to $6.44. GuocoLand, Hong Fok, Far East Orchard and Wing Tai also featured high on the list of top gainers.

ST GRAPHICS

HRnetGroup yesterday became the first recruitment and flexible staffing agency to trade on the mainboard, opening at 95 cents and finishing at 92.5 cents, just 2.8 per cent higher than its offer price of 90 cents, on turnover of 17.5 million.

Based on its offer price, HRnetGroup had a rich trailing price-to- earnings ratio of 22.4 times although the Asian industry average was 28.4 times, according to Maybank Kim Eng.

The IPO of 89 million new shares was 15.26 times subscribed.

Mr Ho Cheun Hon, head of South- east Asia equity Capital Markets for Credit Suisse, said: "We are optimistic that the Singapore equity market will continue to maintain its positive momentum going into the second half of the year, and we believe the market is open for new listings by companies with a clear and compelling investment thesis."

The top active counters were Hu An Cable, which is watch-listed, Sincap and Golden Agri-Resources.

The stock that clocked the most gains over the day was retailer Dairy Farm, which rose 14 US cents or 1.74 per cent to US$8.18.

RHB analyst Juliana Cai said in a note that the stock's recent pullback presented an opportunity to accumulate. "We believe the sales and operating profit decline in the South-east Asia food division was partly due to the store rationalisation in Singapore and Indonesia last year. But the margin expansion story of the supermarkets division remains intact while the health and beauty, and home furnishings segments are picking up."

A version of this article appeared in the print edition of The Straits Times on June 17, 2017, with the headline 'STI ends day - and week - lower'. Print Edition | Subscribe