Singapore stocks continue to falter, bucking regional trend; STI down 0.03%

SINGAPORE – Local shares bucked the trend across the region and dipped into the red on Sept 26 – their third straight day of decline.

The shaky mood left the Straits Times Index (STI) down 0.03 per cent or 1.04 points to 3,582.23, but gainers easily outnumbered decliners 428 to 226 on trade of 1.4 billion shares worth $1.8 billion in the broader market.

DFI Retail Group reversed its fortunes to become the STI’s biggest gainer after being at the bottom of the table on Sept 25. It closed up 2.6 per cent at US$1.99, while Singtel was the biggest loser, 2.1 per cent lower at $3.22.

The local banks continued to slip, with DBS Bank down 0.2 per cent to $38.30, OCBC Bank off 0.3 per cent at $15.23 and UOB retreating 0.5 per cent to $32.36.

Major regional indexes rose despite Wall Street turning weaker after record-setting performances earlier in the week, with the Dow Jones Industrial Average taking the biggest hit, falling 0.7 per cent. The Kospi in Seoul rose 2.9 per cent, while Hong Kong’s Hang Seng jumped 4.2 per cent and Australian shares added 1 per cent, their biggest one-day rise in two weeks, to close just shy of a record high.

The US Federal Reserve’s rate cut should support Singapore market earnings for this half of 2024, said Mr Thilan Wickramasinghe, head of research at Maybank Securities Singapore.

There could be a floor to the downgrades on tech manufacturing and real estate investment trusts (Reits), while rising trends could drive upgrades for gaming, industrials, Internet and telcos.

“We believe the recent bigger-than-expected Fed cuts, as it begins an easing cycle, should help ease funding costs for Reits and tech manufacturing, while also supporting the top line,” said Mr Wickramasinghe.

Lower rates also reduce funding costs while increasing margins in the industrials sector, he added, noting: “A continued tight policy by the Monetary Authority of Singapore should keep the Singapore dollar supported, raising market appeal.”