STI falls ahead of first US presidential debate

Usually a bumper session on Wall Street overnight would fire up local investors, but a region-wide wariness ahead of the first presidential debate in the United States kept the mood subdued yesterday.

The safety-first approach helped send the Straits Times Index (STI) down 11.4 points, or 0.46 per cent, to 2,471.61 on trade of 1.22 billion shares worth $1.06 billion, with losers outnumbering gainers 244 to 178.

The falls mirrored those across the region and came despite the Dow advancing 1.5 per cent and the Nasdaq soaring 1.9 per cent.

Mr Jeffrey Halley, a senior market analyst at Oanda, said Asian stock markets are "failing to share Wall Street's exuberance, with one eye on (Tuesday night's) first US presidential debate".

IG Singapore market strategist Pan Jingyi added that moves in Asian markets are expected to be subdued with the US presidential election ahead.

The STI's top loser was retail firm Dairy Farm International, which lost 3.8 per cent to US$3.76.

At one point, it was down more than 4 per cent, which was more than any full-day loss it has ever incurred since April 21, according to Bloomberg data. It also came in spite of RHB Research and HSBC both raising their calls on the stock to "buy" last week.

The top performer was Keppel Corp, which rose 2.6 per cent to $4.30. The firm announced after the market closed that it is reviewing its offshore and marine (O&M) business and intends to unlock $3 billion to $5 billion in value of its assets over the next three years.

The most active counter of the day was Sembcorp Marine. It added just 0.7 per cent to 14.4 cents but on a volume of close to 70 million shares traded, likely on renewed market chatter about a potential merger with Keppel's O&M division that looks increasingly likely to come to pass.

Regional markets finished mixed.

Hong Kong's Hang Seng dipped 0.85 per cent and Malaysia's KLCI fell 0.51 per cent, but the Shanghai Composite added 0.21 per cent.

Other winners were Japan's Nikkei 225, ahead 0.12 per cent, and the Kospi in Seoul, which added 0.86 per cent.

"Trading was thin ahead of the Chuseok holiday... There are important events such as the US presidential debate, South Korea's September trade data and global PMIs (purchasing managers' indexes) during the holiday season," said Daishin Securities analyst Lee Kyoung-min.

Australia's S&P/ASX 200 index ended flat as investors closed positions at the end of the month, while uncertainties surrounding the US elections kept market sentiment in check.

• Additional reporting by Reuters