Bulls And Bears

Banks weigh on STI; regional markets rise

Three local lenders dip, helping to send index down 0.2% on lacklustre trading day

Regional markets managed to get something out of a lacklustre trading day but the local bourse was dealt a losing hand by the banks.

The downbeat sentiment sent the Straits Times Index (STI) down 5.45 points, or 0.17 per cent, to 3,165.32 - in a stark contrast with China, Hong Kong, Japan, Malaysia and South Korea, which all closed higher.

IG market strategist Pan Jingyi said the market here lacked any real direction, given the lack of reaction to US President Donald Trump's talk of the United States not being ready to make a trade deal with China.

"It had also been a mixed bag between sectors with no clear indication of changes in risk sentiment despite Mr Trump's seeming threat of the potential for more tariffs on Chinese imports to come," she added.

Volumes here clocked in at 929.37 million shares worth $1.74 billion, with winners pipping losers 188 to 177, while only 12 STI stocks closed in the red.

Financials weighed on the STI: DBS Bank lost 0.4 per cent to $24.96; OCBC Bank dropped 0.5 per cent to $10.94; and, United Overseas Bank (UOB) pared gains from recent sessions to end at $24.31, down 1.6 per cent. UOB dipped as trading volume surged during market pre-close due to re-balancing of the MSCI Singapore Index.

The Singapore Exchange (SGX) shed 2.6 per cent to $7.42.

US-listed Chinese e-commerce giant Alibaba is said to be considering a second listing in Hong Kong to raise US$20 billion (S$27.5 billion).

"The news is a likely reason for SGX shares being sold on Tuesday as investors may feel Alibaba's presence will entice future tech firms to list in Hong Kong," said UOB Kay Hian vice-president of equities and financial products Brandon Leu.

Genting Singapore was the benchmark index's most traded, up 1.1 per cent to 89 cents on trade of 27.2 million. Traders noted that the casino operator has been oversold since posting first-quarter earnings on May 9. But yesterday's performance may have been supported by Asian markets rebounding and more awareness of the company confirming last Thursday its bid to develop an integrated resort in Osaka.

Telcos ended in negative territory. Singtel lost 0.6 per cent to $3.15, while StarHub retreated 1.3 per cent to $1.49.

The usually thinly traded Sin Ghee Huat Corp saw heavier than usual activity, thanks to married trades involving 9.85 million shares, or 4.5 per cent of its outstanding share base, at 23 cents. The stainless steel product distributor closed 2.3 per cent down at 21.5 cents.

A version of this article appeared in the print edition of The Straits Times on May 29, 2019, with the headline 'Banks weigh on STI; regional markets rise'. Print Edition | Subscribe