STI down 1.9% for the week on fall in earnings

SIA among top losers while best performer is Dairy Farm; most regional bourses fall

As the impact of the Covid-19 outbreak becomes clearer, with more companies posting earnings declines and misses, the Straits Times Index (STI) yesterday fell 43.63 points or 1.7 per cent to 2,529.82.

Losers outnumbered gainers 289 to 184, on turnover of 1.99 billion shares worth $2.97 billion.

The STI is down 1.9 per cent over this short trading week.

Among the top losers was Singapore Airlines, which has implemented more measures to slash costs, including bigger pay cuts for its bosses, a 10 per cent salary reduction for other staff, and early retirement for pilots and ground staff.

The carrier's shares extended their decline, losing 3.12 per cent to $3.42 yesterday.

The best performer on the index was Dairy Farm International, which rose 3.13 per cent to US$4.28, despite reporting a 35 per cent drop in net profit to US$115 million (S$158.2 million) in its first half.

Analysts remain positive on it, however. DBS Group Research has kept its "buy" rating on the stock, citing its attractive valuation and ongoing transformation that remains "well on track".

The most active counter of the day was Thai Beverage, which added 1.59 per cent to $0.64, with 125.4 million shares changing hands.

Earlier this week, JPMorgan put out a research report on Thai consumer companies, saying that it expected a better showing for those selling staples versus discretionary items, but it was "overweight" on ThaiBev due to its "sufficient valuation discount".

Regional markets were a sea of red on the back of continued coronavirus worries.

At the same time, risk sentiment was buoyed after the US Federal Reserve kept its policy setting unchanged, while pledging it would use its full range of tools, if needed.

Japan's benchmark Nikkei 225 dipped 0.26 per cent, extending its losing streak for a fifth trading day.

"Sentiment sagged after news about fresh business restrictions in Tokyo hit the market," IwaiCosmo Securities' broker Toshikazu Horiuchi told Agence France-Presse, adding: "Investors were also concerned about record infection numbers in Tokyo."

Hong Kong's Hang Seng Index fell 0.69 per cent, and China's benchmark Shanghai Composite Index retreated 0.23 per cent

South Korea's Kospi Index closed up 0.17 per cent - reaching its highest in six months amid continued strong foreign investor buying.

Malaysia's KLCI lost 0.48 per cent and Australia's S&P/ASX 200 closed 0.74 per cent higher.

A version of this article appeared in the print edition of The Straits Times on July 31, 2020, with the headline 'STI down 1.9% for the week on fall in earnings'. Print Edition | Subscribe