The Singapore stock market will likely end the last week of 2016 on a muted note - a stark contrast to the frenzy of action it saw at the start of the year.
"The final week of the year is expected to remain a quiet one, with thin trading conditions to continue as investors unwind before the year ends," IG market strategist Pan Jingyi told The Straits Times.
The week will be a shortened one, with the Singapore market reopening today. It was closed yesterday, along with markets in Hong Kong and the United States. But worries remain beneath the calm.
"Moving ahead, the main concern will remain with US policies as President-elect Donald Trump enters office in January," Ms Pan said, adding that the region will also continue to be focused on China's growth.
Asian markets have taken a hit since Mr Trump's unexpected election win on fears that his fiscal stimulus plans will lead to substantial capital outflows from this part of this world.
The benchmark Straits Times Index dropped 2.27 per cent last week - marking a 0.44 per cent decline for the year so far - in line with the broader pullback across Asian markets.
"The strong US dollar theme, reignited after December's FOMC (Federal Open Market Committee) meeting, has kept concerns of capital outflows from Asian markets at the top of traders' minds. This had weighed on regional indices," said Ms Pan. The US Fed raised rates on Dec 14, and is widely expected to roll out more rate hikes in the course of 2017.
Some of the notable movers here last week included the three local banks, which all clocked losses. DBS Group Holdings, for instance, finished flat at $17.39 on Friday and was down 3.5 per cent for the week.
Australian oilfield services firm AusGroup sank 8 per cent through the week to $2.222. It flagged a potential event of bond default last Friday in a market already badly stung by a spate of defaults this year.
The mainboard-listed firm is seeking consent from bond holders to extend the maturity of $110 million worth of notes by two years, to 2018.
The group, which has pledged its Port Melville facility in the Northern Territory to bond holders as security in return, was unable to meet the deadline to obtain a written ministerial consent for the property's mortgage as the Australian minister-in-charge was away.
Meanwhile, the first initial public offering (IPO) this year - HC Surgical Specialists - slipped 0.8 per cent during the week to 60 cents on Friday.
Mr David Cheng, head of corporate finance at OCBC Bank, noted that while the local IPO market has rebounded this year, the number of deals and proceeds raised still lagged behind those of a few years ago - reflecting the challenging market conditions. "Investor sentiment remains cautious going into 2017 but could turn positive if global macro factors continue to re-rate higher," he told The Straits Times.
"One thing for sure is that investors continue to look for attractive deals, including IPO companies that are priced appropriately. With a hopeful pipeline of issuers looking to raise capital, we expect to see the comparably stronger companies tap the equity markets next year."
Jacqueline Woo
