The startling news that United States President Donald Trump and his wife had tested positive for Covid-19 rattled investors across the globe yesterday, but local traders soon got back on an even keel.

The initial reaction on the local market saw the Straits Times Index (STI) fall as much as 1.2 per cent, but that appeared to be a knee-jerk reaction as the index clawed back losses to finish just 4.63 points, or 0.19 per cent, lower at 2,496.11, and up 0.96 per cent for the week.

There were 946.63 million shares worth $860.45 million traded, with losers outpacing gainers 192 to 137.

Airline gateway services provider Sats was the index's best performer, rising 2.07 per cent to $2.96 after DBS Bank raised it to a "buy" call with a target price of $3.66.

The brokerage pointed to a recovery to pre-Covid-19 levels for international air travel in 2022. It expects the stock to re-rate and normalise ahead of an anticipated vaccine approval next year.

The STI's worst performer was Thai Beverage, which lost 2.46 per cent to 59.5 cents on news that the beverage company was waiting to hear from its unit, Saigon Beer Alcohol Beverage Corp, if the Vietnamese government was planning to divest its remaining stake in the beer maker.

Sembcorp Marine was the most active counter for the fourth consecutive day, trading strong with a volume of 123.8 million shares, although it closed down 3.9 per cent to 14.8 cents after a four-day price rally. Investors appeared to be hopeful of a merger with rival Keppel's offshore and marine unit.

Markets around the region were mixed. Japan's Nikkei 225 shed 0.67 per cent after recovering from an outage on Thursday. Malaysian shares added 0.24 per cent.

Weak commodity prices and risk aversion in the wake of Mr Trump's diagnosis sent Australia's S&P/ASX 200 index sliding 1.4 per cent, leaving it down 2.9 per cent for the week - its worst weekly fall since late-April.

Oanda senior market analyst Jeffrey Halley said: "The Trump Covid-19 diagnosis is a strong negative for financial markets and will lead to a rotation into defensive positioning."

Even before Mr Trump tested positive, markets had been pricing in the likelihood of turbulence on election day and the ensuing weeks.