Bulls And Bears

STI bucks regional trend to end lower

Two Jardine stocks, banks weigh it down; Asian bourses rise on upbeat China data

Local shares bucked the regional trend and headed down yesterday with a range of the benchmark's heavyweights among the laggards.

The Straits Times Index (STI) retreated 5.95 points, or 0.19 per cent, to close at 3,187.97. Jardine Matheson Holdings, down 4.5 per cent to US$53.70, and Jardine Strategic Holdings, 2.7 per cent lower at US$30.90, were the main contributors to the STI's subpar showing.

The banking trio also played their part in the STI's relative under-performance to regional benchmarks. DBS dropped 0.5 per cent to $25.13, OCBC Bank eased 0.3 per cent to $10.75 while United Overseas Bank closed at $25.77, down 0.2 per cent.

In contrast, Singtel had a stellar showing, ending at a four-month high after advancing 2.4 per cent to $3.46 on 52.7 million shares traded, the most among STI counters.

Traders noted that interest in the telco was attributed to its Indian associate Bharti Airtel announcing on Sunday that prices of its prepaid services will increase from today.

Elsewhere in the Asia-Pacific, Australia, China, Hong Kong, Japan, Malaysia, South Korea and Taiwan closed markedly higher.

Regional investors had much cause for optimism yesterday even though there were trade deal worries after Beijing warned of "strong counter-measures" after United States President Donald Trump passed the Hong Kong pro-democracy Bill into law last week.

The bright spark driving risk-friendly sentiment in the region was the slew of better-than-expected manufacturing data from China, where most notably, the official manufacturing Purchasing Managers' Index (PMI) reading for last month showed expansion for the first time in seven months.

China's official service sector PMI, as well as the Caixin manufacturing PMI, which focuses more on smaller-and medium-sized firms, also beat estimates.

Mr Vishnu Varathan, Mizuho Bank's head of economics and strategy for the Asia and Oceania treasury, acknowledged in a client note that the "surprise recovery" in official factory data has triggered "some optimism". He added: "This is not unjustified, but relief should not be mistaken for cheer."

In Singapore, investor optimism was most evident in the cyclical tech sector, where manufacturer AEM Holdings surged 8.9 per cent to $1.96 and UMS Holdings closed 3.3 per cent higher at 93.5 cents.

Trading volume here stood at 888.19 million shares worth $975.74 million, with gainers pipping losers 186 to 177.

A version of this article appeared in the print edition of The Straits Times on December 03, 2019, with the headline 'STI bucks regional trend to end lower'. Print Edition | Subscribe