Singapore shares fall amid signal of slower-than-expected US rate cuts; STI down 1.4%

SINGAPORE - Shares in Singapore ended Feb 5 in the red, after United States Federal Reserve chair Jerome Powell said the Federal Open Market Committee is unlikely to cut rates in March.

The benchmark Straits Times Index (STI) finished at 3,134.29, down 1.4 per cent or 45.48 points.

Across the broader market, losers outnumbered gainers 351 to 241, on turnover of 1.85 billion securities worth $1.25 billion.

Key regional indexes mostly fell. Hong Kong’s Hang Seng Index inched down 0.2 per cent, South Korea’s Kospi Composite Index shed 0.9 per cent, and the FTSE Bursa Malaysia Kuala Lumpur Composite Index fell 0.4 per cent.

However, Japan’s Nikkei 225 rose 0.5 per cent.

The falls came as investors grappled with Mr Powell’s latest comments implying fewer rate cuts in 2024. The Fed chief said in an interview aired on Feb 4 that the central bank wanted to see more data on inflation “moving sustainably down to 2 per cent”.

Meanwhile, robust data on US jobs on Feb 2 showed non-farm payrolls rising by 353,000 in January, beating expectations.

Mr Paul Chew, head of research at Phillip Securities, said nearly two-thirds of the job additions are from the government and healthcare sectors. “These jobs are growing at almost triple their pre-pandemic pace,” he added.

At home, the top gainer on the STI was Hong Kong-based conglomerate Jardine Matheson Holdings, which rose 2.3 per cent or 92 US cents to US$41.68.

Real estate investment trust Mapletree Pan Asia Commercial Trust was at the bottom of the index, after it lost 5.5 per cent or eight cents to end at $1.38.

All three local banks fell on Feb 5. DBS Bank lost 1.2 per cent or 37 cents to $31.85, OCBC Bank shed 1.5 per cent or 19 cents to $12.81, and UOB was down 0.8 per cent or 23 cents to $28.39.

THE BUSINESS TIMES