S'pore stocks deeper in red on IMF remarks

Mood on SGX dampened after agency's call for monetary policy changes if deflation sets in

Local shares sank further into negative territory yesterday after the International Monetary Fund said Singapore's central bank should adjust its monetary policy further if deflation takes root.

Remisier Alvin Yong noted: "That added to the dour mood for the stock market yesterday afternoon."

The Straits Times Index slipped 0.9 per cent or 24.91 points to 2,741.15 points, weighed down by Singtel and the three banks.

The telco fell 1.5 per cent, or six cents, to $3.83, while DBS Group dipped 0.7 per cent, or 11 cents, to $14.80. OCBC lost 1.5 per cent, or 13 cents, to $8.30 and UOB dropped 0.8 per cent, or 15 cents, to $17.73.

Meanwhile, traditional Chinese medicine firm Eu Yan Sang called for a trading halt yesterday after it got hit with a trading query by the Singapore Exchange on unusual price movements in its stock.

Eu Yan Sang shares have gained nearly 22 per cent since last Thursday, and were up more than 10 per cent, or six cents, to 64.5 cents yesterday before it halted trading.

Traders cite rumours that the TCM specialist may be delisted and taken private.

Toll road operator China Merchants Holdings (Pacific) is moving to delist from SGX. Its shares jumped 18.2 per cent, or 15.5 cents, to $1.005 following its announcement of a privatisation bid at $1.02 per share.

Sino Grandness Food Industry Group jumped 5.9 per cent, or 3.5 cents, to 62.5 cents on rumours that Swiss food giant Nestle may take a stake in the proposed Hong Kong initial public offering of its fruit and vegetable juice producing unit, Garden Fresh Holding, according to NetResearch Asia.

Last month, Sino Grandness submitted an application for Garden Fresh to be listed in Hong Kong.

Best World shares gained 8.4 per cent, or seven cents, to 90 cents after it said it is in talks over a potential property acquisition.

The most actively traded counters included Noble Group, which gained 2.9 per cent, or one cent, to 36 cents, with 80.1 million shares traded.

Ezra Holdings dipped 1.2 per cent, or 0.1 cent, to 8.4 cents, with 30.7 million shares traded, while Golden Agri-Resources fell 3.9 per cent, or 1.5 cents, to 36.5 cents, with 30.6 million shares changing hands.

Neptune Orient Lines was flat at $1.29 after reporting a wider net loss for the first quarter from a year ago.

French shipping company CMA CGM's proposed cash acquisition of NOL received approval late last month from the European Commission, and the remaining pre-conditions related to antitrust regulatory clearances should be satisfied by mid-2016, NOL said.

"In view of weak freight rates outlook on overcapacity reasons, we continue to keep our forecast for a loss-making full-year 2016 unchanged. Therefore... we maintain our recommendation to accept the offer when pre-conditions are met," OCBC Investment Research said.

A version of this article appeared in the print edition of The Straits Times on May 11, 2016, with the headline 'S'pore stocks deeper in red on IMF remarks'. Print Edition | Subscribe