Bulls And Bears

S'pore stocks decline despite regional rally

STI dragged down by three local banks while property and related counters still doing well

Singapore equities erased Monday's gains yesterday despite a regional rally.

The benchmark Straits Times Index (STI) eased 13.76 points, or 0.42 per cent, to 3,294.93, with 1.07 billion shares worth $1.07 billion traded across the bourse.

Singapore and Hong Kong, which slipped 0.28 per cent, racked up losses even as most other markets in Asia rallied. Tokyo led gains with a 1.11 per cent rise, while Shanghai added 0.43 per cent and Sydney put on 0.47 per cent.

"No news from North Korea is good news for the market," Mr Taye Shim, head of research at Jakarta- based Mirae Asset Sekuritas, said in a Reuters report, referencing the geopolitical tensions between North Korea and the United States.

"Our view is that the North Korea risk is something that investors will need to live with."

All three local banks were a big drag on the STI yesterday. OCBC Bank took the biggest hit as it sank 1.5 per cent or 17 cents to $11.21, while DBS Group Holdings fell 1.3 per cent or 27 cents to $20.78. United Overseas Bank pared 0.6 per cent or 14 cents to $23.96.

Golden Agri-Resources dropped 2.7 per cent or one cent to 36.5 cents. The palm oil giant on Monday posted a 44.7 per cent slump in second-quarter earnings to US$21.9 million (S$29.8 million).

Property and related counters, on the other hand, continued to do well. CapitaLand Mall Trust rose 1 per cent or two cents to $2.11, while CapitaLand advanced 0.5 per cent or two cents to $3.80. Hongkong Land Holdings climbed 0.5 per cent or four US cents to US$7.63.

Outside of the blue chips, TT International said it has applied for an extension until Feb 14 next year to announce its financial statements for the first and second quarters of the fiscal year 2018. It said this will give the firm adequate time to pursue a resolution, including ongoing debt restructuring. Trading in the stock has been suspended since July 28, when it closed at 1.4 cents.

Meanwhile, offshore marine firm Ezion Holdings, which last traded at 19.7 cents on Aug 8, requested a trading suspension on Monday. The group said it is in discussions with its stakeholders such as bank lenders and creditors regarding its financing and capitalisation structure.

DBS analyst Ho Pei Hwa in a report downgraded the stock to "fully valued", noting that the sudden deterioration of cash balances to US$93 million - from US$187 million in the first quarter - and the reversal of operating cash inflow to outflow during the second quarter had raised red flags.

"The high net gearing ... tight credit access, and unexpectedly slow pick-up in business have dampened Ezion's ability to secure refinancing," said Ms Ho.

Real estate firm Rowsley was the day's top traded counter, sliding 1.9 per cent or 0.2 cent to 10.5 cents on 72.2 million shares done.

A version of this article appeared in the print edition of The Straits Times on August 16, 2017, with the headline 'S'pore stocks decline despite regional rally'. Print Edition | Subscribe