STI slides despite hopes of 'sustained rebound'

The Straits Times Index ended the first trading day of the week at 2,629.69, down 5.14 points or 0.2 per cent from Friday.

This despite optimism for a "sustained rebound" on prospects of an imminent economic recovery by Morgan Stanley Research in a report yesterday, following Singapore's entry last week into phase two of its reopening from circuit breaker measures.

Decliners outnumbered gainers 285 to 135, with 1.21 billion securities worth $1.21 billion traded. Among the index constituents, real estate firm Hongkong Land rose the most - up 3.46 per cent to US$4.19 - on positive news late last week of a tie-up with Asia Bankers Club and developer An Khang to introduce The Marq, a luxury development in Ho Chi Minh City, Vietnam.

Shares of Singapore Exchange (SGX) fell the most - by 2.05 per cent to $8.12, pulling back from a steep surge last Friday. The stock has lost the exuberance it had in April and May, following news in late May that it will discontinue most of its MSCI equity index futures and options contracts, while its rival the Hong Kong bourse at the same time struck a deal for a suite of MSCI equity indexes similar to those offered on the SGX.

The most active counter, crushed limestone producer GCCP Resources, added 10 per cent to $0.011, on news last week that its substantial shareholder Lim Soon Foo beefed up his stake from 4.66 per cent to 6.14 per cent in a market transaction on June 12.

Regional markets lacked direction. The Hang Seng Index slipped 0.54 per cent. China's benchmark Shanghai Composite Index eased 0.08 per cent but Shenzhen Composite Index added 0.29 per cent.

Seoul stock market's benchmark Kospi was down 0.68 per cent as market sentiment was dampened, owing to the country's downbeat export data and renewed fears over a second wave of the coronavirus.

Japan's Nikkei fell 0.18 per cent and MSCI's broadest index of Asia-Pacific shares outside Japan was almost flat. The yen subsequently gained ground on the US dollar as investors switched out of riskier assets like stocks and into safe-haven assets like the Japanese currency.

Australian shares ended flat, with gains among gold miners offset by losses in tech and energy stocks.

"Investors grew wary about the risk of growing virus infections negatively affecting business activities overseas," said Ms Maki Sawada, vice-president of the investment research and investor services department at Nomura Securities.