Noble Group out of benchmark ST Index

Beleaguered commodity trading company Noble Group will be removed from the benchmark Straits Times Index (STI), from March 21.

FTSE Russell, which compiles indexes across major asset classes, said yesterday that CapitaLand Commercial Trust will be added to the STI. The changes take effect on March 21, with the next review to be held on June 2.

Noble Group suffered a US$1.67 billion (S$2.3 billion) net loss last year, its first annual loss since 1998, owing to impairments made for weak coal prices. It has also been battling allegations of accounting and governance issues from critics like Iceberg Research.

Noble's market capitalisation has fallen some 64 per cent over a year, from $6.8 billion to about $2.48 billion, in line with falling commodity prices, which could have affected its standing among other factors.

FTSE also said the STI reserve list, made up of the five highest- ranking non-constituents of the STI by market capitalisation, will be: Suntec Real Estate Investment Trust (Reit), shipping firm Neptune Orient Lines, Indonesian palm oil producer First Resources, national postal service provider Singapore Post and Keppel Reit.

Firms on the reserve list will replace any firm that becomes ineligible owing to corporate actions, before the next review.

FTSE teamed up with Singapore Press Holdings, publisher of The Straits Times, and Singapore Exchange to calculate the Singapore stock market's main benchmark.

Investors closely watch the STI, considered the benchmark for the Singapore market.

It is the basis for a range of financial products including exchange-traded funds, futures, warrants and other derivatives. FTSE is the index administrator.

The indexes are reviewed half- yearly, in line with the index ground rules, and also reviewed quarterly to quicken the pace of including eligible initial public offering stocks.

A version of this article appeared in the print edition of The Straits Times on March 04, 2016, with the headline 'Noble Group out of benchmark ST Index'. Subscribe