Bulls And Bears

No happy new year for Singapore bourse

China's dismal factory data, tension between Saudi Arabia and Iran make for bleak outlook

The local stock market started the trading year yesterday with a rush of red ink on renewed worries over the global economy.

The benchmark Straits Times Index (STI) fell 46.76 points or 1.62 per cent to 2,835.97, mirroring similar falls across the region.

It took its cue from China, where Shanghai plunged 6.9 per cent and Shenzhen crashed 8.2 per cent before a trading halt was called in the afternoon for the rest of the session.

This came after dismal factory data from China on Sunday and news of heightened tensions between oil producers Saudi Arabia and Iran.

Tokyo lost 3.1 per cent, Hong Kong slid 2.7 per cent and Jakarta was down 1.5 per cent.

In the United States, Wall Street fell 1 per cent last Thursday, before closing for the New Year holiday.

"We were starting to see signs that the economic slowdown in China had run its course, so today's report was a disappointment," Mr Masayuki Otani, Tokyo-based chief market strategist at Securities Japan, told Bloomberg.

"The Saudi Arabia and Iran issue might be good for oil, but the increase in geopolitical risk means it's an overall negative for the financial markets."

At home, the losses were led by telco giant Singtel, which fell eight cents or 2.2 per cent to $3.59.

The local lenders fared poorly as well. DBS Group Holdings dropped 41 cents or 2.5 per cent to $16.28, United Overseas Bank lost 52 cents or 2.7 per cent to $19.09 and OCBC Bank shed 16 cents or 1.8 per cent to $8.64.

Global Logistic Properties sank six cents or 2.8 per cent to $2.09. This was before it announced after the market closed that it has signed new leases totalling 940,000 sq ft with three industry leaders in China.

On the other side of the ledger, developer City Developments was among the handful of gainers yesterday, inching up three cents or 0.4 per cent to $7.68.

Hongkong Land had a good showing as well, rising 10 US cents or 1.4 per cent to US$7.10.

Outside of the STI, marble block producer Terratech Group emerged as the day's most heavily traded, with 54.5 million shares changing hands. The counter surged one cent or 16.7 per cent to seven cents.

Real estate player Yoma Strategic Holdings jumped 2.5 cents or 5.4 per cent to 49 cents, after announcing that it has extended until 2048 the lease for its landmark hotel project at the former headquarters of the Myanmar Railway Company.

Upstream oil and gas explorer KrisEnergy advanced 0.7 cent or 4.2 per cent to 17.3 cents. It said it has more than doubled its average production rate from last year to 19,935 barrels of oil a day as at Jan 1.

Overall activity on the exchange was lacklustre, with 980.7 million units worth $852.4 million changing hands.

A version of this article appeared in the print edition of The Straits Times on January 05, 2016, with the headline 'No happy new year for Singapore bourse'. Print Edition | Subscribe