Bulls And Bears

STI ends worst quarter since 2008 on high note

Better-than-expected Chinese factory data for March lifts sentiment

Singapore's Straits Times Index (STI) closed higher yesterday after official Chinese factory data for last month beat expectations, lifting sentiment at the tail end of a quarter that will be remembered for the coronavirus outbreak.

The local benchmark, which opened more than 2 per cent up, finished 64.99 points, or 2.7 per cent, higher at 2,481.23 with four of the 30 STI counters ending in the red.

For the first quarter, the STI's 23 per cent decline is its worst quarterly performance since the fourth quarter of 2008.

Elsewhere in the Asia-Pacific, equity benchmarks in China, Hong Kong, Malaysia, South Korea and Taiwan were higher. Australia closed lower after investors booked profits following Monday's record showing; Japan also closed lower.

The economic effects of the virus are likely to remain for the rest of the year. UOB economist Ho Woei Chen said it would be "difficult to conclude" from yesterday's readings whether China is "now back in a business-as-usual environment".

"Looking ahead, we continue to expect a contraction in China's Q1 2020 gross domestic product by 3.4 per cent year-on-year (y-o-y), when the data is released on April 17. From there, we expect the economy to recover to 5.7 per cent y-o-y in Q2 2020," she noted.

Among STI counters, Genting Singapore was the most traded with 89.3 million shares changing hands. The casino operator advanced 7.8 per cent to 69 cents.

Following last Thursday's supplementary budget by the Government, CGS-CIMB head of research Lim Siew Khee said Genting could achieve $70 million to $171 million in cost savings in FY2020 due to the enhanced Jobs Support Scheme and property tax rebates. The measures could cushion the impact of the reduction in tourist flows, she said.

ComfortDelGro closed 2.7 per cent higher at $1.52. The land transport company, which indicated on Monday that its taxi segment could record a loss in FY2020, is down 36 per cent this year.

DBS Group Research analyst Andy Sim said the market has priced in the "dire outlook" but pointed out that "there are limited re-rating catalysts at this juncture".

Among firms in the second line, Biolidics shares jumped 22.7 per cent to 27 cents. The Catalist-listed cancer-diagnostics company said it is set to launch a rapid test kit for the virus this month.

Across the Singapore market, advancers outpaced decliners 294 to 152, with 1.34 billion securities valued at $1.93 billion changing hands.

A version of this article appeared in the print edition of The Straits Times on April 01, 2020, with the headline 'STI ends worst quarter since 2008 on high note'. Print Edition | Subscribe