Talk that Washington may impose Huawei-like sanctions on Chinese tech firm Hikvision wiped out early gains yesterday and left the local market flat.
Shares had staged a bright start to rally from Tuesday's knee-jerk reaction to gloomy first-quarter gross domestic product numbers and a lowered growth outlook. Investors were also buoyed by the US' Huawei ban being lifted for 90 days.
But optimism ran out in the wake of the Hikvision speculation and the Straits Times Index (STI) dipped into negative territory in the late session, but did recover somewhat to close at 3,183.14, down 0.12 point.
While the possible US action on Hikvision dented the already fragile investor confidence because of the US-China trade spat, its effect, for now, seems muted.
IG market strategist Pan Jingyi noted: "Even though reports suggested that the Trump administration could potentially blacklist Chinese surveillance companies and add fuel to fire, investors are likely waiting for official confirmation."
Elsewhere, Australia, Hong Kong, Japan and South Korea posted modest gains but China and Malaysia fell.
Trading volume here clocked in at 939.17 million shares worth $931.2 million, with losers pipping gainers 182 to 177, while 15 of the STI's 30 stocks ended in the red.
They included Genting Singapore, which was the benchmark index's most traded stock, with 44.5 million shares changing hands as it lost 0.6 per cent to 87.5 cents.
"Genting Singapore's fundamentals are still good but investors are anticipating an outflow of cash for expansion plans and other cost increases," a dealer said.
Despite Genting's recent slide, remisier Ernest Lim noted that most analysts remain positive on it.
The Jardine firms were among the STI's best performers. Jardine Matheson Holdings (JMH) added 3.9 per cent to US$62.95, Jardine Strategic Holdings (JSH) put on 4.2 per cent to US$36.52, and Jardine C&C gained 2.2 per cent to $33.76.
Ms Pan suggested that a JMH unit's purchase of JSH shares on the London stock exchange on Tuesday had bolstered the counters.
Their performance helped the STI counter the slide in the banks.
DBS dropped 1.2 per cent to $25.43, OCBC Bank dipped 0.6 per cent to $11.02, while United Overseas Bank fell 1.2 per cent to $24.53.
Tech counters, which were sold off on Tuesday on worries of the US ban on Huawei, were mixed.
AEM Holdings was unchanged at 93 cents, Hi-P International fell 1.6 per cent to $1.22, while Venture Corp gained 0.4 per cent to $15.43.
