Asian markets, including Singapore, took a hit as expected after the major United States healthcare reform collapsed on Friday, raising doubts over the future of President Donald Trump's economic agenda.
The local benchmark Straits Times Index closed down 16.02 points or 0.51 per cent at 3,126.88, in a slow day with only $979.2 million worth of shares traded across the whole market.
Singapore was not alone. Shanghai shed 0.08 per cent, Hong Kong slid 0.68 per cent, and Kuala Lumpur eased 0.05 per cent. Tokyo pared 1.44 per cent, as investors reacted to the stumbling United States dollar which also pushed up the Japanese yen.
The greenback has been on a slide for over a week, settling at about 1.393 against the Singdollar by yesterday evening.
"Dollar scepticism may deepen in the near term after the failure of the healthcare Bill to muster even a vote, as prospects for promised tax reform and infrastructure spending are now under increased scrutiny," OCBC analyst Emmanuel Ng said. He puts the next US dollar-Singdollar resistance level at 1.40.
As for the stock markets, the cooling sentiment which had led to a nearly 2.5 per cent drop in the Dow Jones Industrial Average since the start of this month will also cast a cloud over Asia.
"The headwind from the US is likely to have a negative impact on Asian markets in the days to come, while markets also need some reason to take profit after three months of rallying," CMC Markets analyst Margaret Yang said.
In all, 21 STI component stocks fell, with Golden Agri-Resources losing one cent or 2.6 per cent to 37.5 cents on 33.04 million shares traded.
Global Logistic Properties (GLP) was also actively traded, with 20.37 million shares changing hands as it dropped four cents or 1.43 per cent to $2.76. However, GLP's shares were at a 12-month high just last Friday amid news that it has buyout offers from several bidders.
Singtel shed three cents or 0.77 per cent to $3.88 on 21.34 million traded shares, while StarHub closed down two cents or 0.69 per cent at $2.86. Outside the STI, M1 dropped three cents or 1.38 per cent to $2.14.
Only six STI stocks ended in the black. Thai Beverage rose one cent or 1.08 per cent to 93.5 cents, and Genting Singapore added one cent or 1.02 per cent to 99.5 cents.
Outside the benchmark, Boustead Projects was among the better performers, rising two cents or 2.48 per cent to 82.5 cents.
CIMB analysts recently initiated coverage on the industrial property developer, giving it a buy rating ahead of a potential real estate investment trust listing for its assets.
"We believe Boustead Projects could be ready for a Reit listing by financial year 2020 to 2021… We estimate a potential Reit launch could re-rate Boustead Projects to $1.30-1.39," a recent CIMB note said.