Singapore stocks end lower as investor appetite sours; STI down 0.2%

SINGAPORE – Hawkish cues from the United States overnight on interest rates sent local shares down on May 24 – a signal to some observers that the bull run in global equities is showing signs of waning.

The pessimism left the Straits Times Index (STI) down 0.2 per cent, or 6.06 points, at 3,316.56 points, with turnover of 1.3 billion securities worth $1 billion. Losers trounced gainers 335 to 271.

Regional bourses also ended lower: The Nikkei 225 in Tokyo fell 1.2 per cent; the Hang Seng in Hong Kong, 1.4 per cent; the Kospi in Seoul, 1.3 per cent; and the ASX 200 in Sydney, 1.1 per cent.

The declines follow falls on Wall Street, with the Dow Jones Industrial Average down 1.5 per cent, its worst one-day percentage drop since March 2023.

RHB Bank acting group chief economist Barnabas Gan said the latest minutes from the US Federal Reserve showed “a severe lack of progress” on the committee’s inflation objective of 2 per cent.

Market swap pricing may indicate two rate cuts in 2024, but the reality is likely one or zero cuts for the rest of this year, he added.

Mr Gan noted that higher-for-longer US interest rates will mean global rates will stay elevated for the rest of the year, with “clear implications” for average mortgage rates in the US and certain countries in Asean.

The biggest STI loser by value was Jardine Matheson Holdings, which gave up 0.7 per cent to close at US$38.20. Sembcorp Industries was another top decliner, shedding 2.3 per cent to $5.07.

Jardine Cycle & Carriage was the STI’s top gainer, rising 0.9 per cent to $27.55 on a cum-dividend basis.

Local lenders ended mixed. DBS Bank was up 0.1 per cent at $35.87, while OCBC fell 0.3 per cent to $14.45 and UOB closed flat at $30.55.

THE BUSINESS TIMES