Last Friday, Singapore's Straits Times Index fell 17.65 points or 0.55 per cent to close at 3,181.03. For the week, the blue-chip index slipped 39 points or 1.2 per cent from 3,220.03.
The market has been absorbing Budget-related measures, with several of them expected to mitigate the impact of the coronavirus outbreak on locally listed companies.
But analysts have pointed out that Budget relief measures may not be sufficient to cushion the fallout if the Covid-19 disease outbreak drags on.
The $6.4 billion in virus support - including $4 billion for firms, $1.6 billion for households, and $800 million for front-line agencies - came as a much-needed reprieve for sectors including tourism, aviation, retail, food services and point-to-point transport.
Deputy Prime Minister and Finance Minister Heng Swee Keat highlighted in the Budget speech that Singapore must be prepared that the economic impact may be worse than the baseline projection of 0.5 per cent growth this year.
While the spread of the coronavirus remains a key near-term concern, China is starting to see a slowdown in the number of reported infections and a slight pickup in production levels.
But analysts noted that the overall operational capacity is still far from optimal.
BNP Paribas' economists have reduced its forecast for global gross domestic product growth this year to 2.6 per cent from 3 per cent, mainly dragged down by China and Japan.
"Global and regional growth is expected to suffer more now than during the Sars episode, given China's larger economy, stronger global supply chain linkages and higher outbound tourist flows," noted a BNP Paribas report.
While attention has been on the coronavirus in recent weeks, the corporate earnings season is still ongoing, with some of Singapore's blue chips releasing their results in the week ahead.
These include ST Engineering, CapitaLand, City Developments, Jardine Cycle & Carriage, Venture Corporation, Yangzijiang Shipbuilding and UOL Group.
Other key releases include January's consumer price index (CPI) today and industrial production figures on Wednesday.
Bloomberg estimates for the CPI indicated a higher headline inflation reading of 0.9 per cent year on year from 0.8 per cent in December, while industrial production was estimated to see a year-on-year contraction of 5.8 per cent.
Meanwhile, water treatment company Memiontec Holdings announced last Friday the launch of its initial public offering of 33.5 million shares at 22.5 cents per share to raise around $7.53 million in gross proceeds. It is due to commence trading on March 5.
