Equity markets in Asia continued to trade mixed as US-China trade frictions and lower oil prices weighed on investors before the release of US consumer price index (CPI) data for July.
On Wednesday, China said it will impose a tariff rate of 25 per cent on US$16 billion (S$21.8 billion) worth of goods imported from the United States from Aug 23, the same day the Trump administration plans to levy 25 per cent additional tariffs on US$16 billion worth of Chinese goods.
UOB's head of research Suan Teck Kin said in a note: "With the tug-of-war on trade continuing... and stakes getting larger, there is no sign that both sides will be backing down."
A plunging Russian rouble and Turkish lira also affected global equities and emerging markets yesterday. This sent the US dollar index to 96.02, among its highest levels since July last year, shortly after markets in Singapore closed.
Among regional markets, the Shanghai Composite and Kuala Lumpur Composite ended higher.
In what has been a topsy-turvy week for mainland Chinese equities, Shanghai's main equity benchmark gained 2 per cent across the week, its best week since mid-July.
The Nikkei 225, Hang Seng, Kospi and ASX 200 ended the day lower. Investors of Japanese-listed stocks held off on buying before holidays as they awaited the outcome of US-Japan trade talks.
The benchmark Straits Times Index (STI) closed down 1.3 per cent or 41.96 points to 3,284.78. About 1.82 billion shares worth $1.43 billion changed hands, which worked out to an average unit price of $0.78 per share. Losers greatly outnumbered gainers 247 to 165.
On a turnover of 55.4 million shares, Ezion Holdings was the biggest gainer and most hotly traded, climbing 2.7 per cent to close at 7.5 cents. The liftboat operator returned to profitability mainly on fair value adjustments arising from its refinancing exercise.
The STI's biggest loser, Jardine Cycle & Carriage, closed $1.08 or 3.1 per cent down at $34.02.
With geopolitical uncertainty and falling oil prices, the big three banks were among the biggest losers. DBS closed 1.6 per cent lower at $25.59; OCBC Bank ended 1.7 per cent down at $11.80; and UOB finished 1.2 per cent lower at $28.
With the dip in oil prices, stocks with exposure to the offshore and marine sector also suffered, with Keppel Corp shares closing 2.9 per cent lower at $6.72.