Bulls And Bears

Investors on edge ahead of Brexit vote today

Local shares down but HK and Shanghai inch up on polls favouring Remain vote

Stocks lost gains and closed in the red on concerns ahead of Britain's Thursday vote on whether to leave European Union.

Caution was again the watchword for Asian investors yesterday, on the cusp of today's historic Brexit vote in Britain.

The benchmark Straits Times Index (STI) reversed earlier gains in last-minute trade, retreating 3.32 points or 0.12 per cent to 2,786.13.

Elsewhere in the region, Tokyo slid 0.64 per cent on a stronger yen and Sydney pared 0.06 per cent.

Hong Kong put on 0.61 per cent and Shanghai rose 0.94 per cent as the latest polls showed voters in Britain were more for staying within the European Union.

The same optimism drove Wall Street higher overnight by 0.14 per cent, also helped by Federal Reserve chairman Janet Yellen's cautious comments on the US economy - a signal that the next interest rate hike may not come so soon.

Still, bourses remained on edge amid fears that a Brexit outcome could disrupt the global economy.

KGI Fraser Securities trading strategist Nicholas Teo noted that key markets have "all gone quiet" - a far cry from the volatility seen in the past two weeks.

"In reality, though, with the 'undecided' vote still at a significant level, the swing factor to either side continues to remain a real possibility," said Mr Teo.

"With the outcome still too close to call, traders have taken big bets off the table, riding only on small positions left over."

Of the 30 STI constituent stocks, 15 clocked gains while 12 closed lower.

Weighing on the index was Thai Beverage Public Company, which dropped 1.5 cents or 1.6 per cent to 89.5 cents, as well as Singapore Exchange, which was down six cents or 0.8 per cent to $7.42.

Commodity counters also fared poorly, with Golden Agri-Resources falling half a cent or 1.4 per cent to 35 cents, while all of the three local banks finished in the red.

Outside the STI, Singapore Post sank 5.5 cents or 3.5 per cent to $1.505 in heavy trade, after the group said on Tuesday evening that chief operating officer Sascha Hower has quit - the latest in a string of high-level departures.

Offshore firm Ezion Holdings, which announced on Tuesday after the markets closed that it has entered into a joint venture agreement to acquire a 49 per cent stake in an Indonesian company, fell one cent or 1.9 per cent to 52 cents.

OCBC Investment Research analyst Low Pei Han maintains a "hold" rating on the stock, noting the firm has been generating positive operating cash flows, which is "a credible performance compared to peers".

"However, the operating environment is expected to remain difficult in view of the depressed state of the group's core sectors," she added.

Penny stock LionGold Corp, which surged 0.1 cent or 50 per cent to 0.3 cent, was the day's top active on 49.9 million shares done.

A total of 791.3 million units worth $781.6 million was traded across the bourse.

A version of this article appeared in the print edition of The Straits Times on June 23, 2016, with the headline 'Investors on edge ahead of Brexit vote today'. Subscribe