Bulls And Bears

STI starts March on feeble note as Wall Street slides

S'pore and region fall amid US stock skid on uncertainty over pace of Fed rate hikes

March began with a sea of red engulfing the local bourse and regional markets following Wall Street's tough day on uncertainty over the pace of rate hikes in the United States.

The benchmark Straits Times Index (STI) slipped 4.09 points or 0.12 per cent to 3,513.85 with 2.2 billion shares worth $1.5 billion changing hands. Losers outpaced gainers 268 to 144.

"US data was not a bed of roses," said OCBC Investment Research, referring to the release of fourth-quarter gross domestic product figures, which met market expectations, and a decline in January's pending home sales.

The US Federal Reserve's optimism about the economy has led to expectations of a more aggressive pace of rate hikes.

"After a period of policy certainty (or complacency) on gradual pace of rate hikes, uncertainty ... is now returning under a new leadership," Maybank FX Research said.

The STI lost 0.4 per cent in February but its showing for the first two months of the year hasn't been shabby. Investor education portal My Gateway said the index generated a 3.6 per cent total return for these months, which outpaced the 0.8 per cent average gain for the benchmarks of Australia, Hong Kong and Japan.

All of Singapore's three banking stalwarts saw gains yesterday. DBS Group rose 10 cents to $28.80 while OCBC gained 15 cents to $13.21 and UOB advanced 15 cents to $28.04.

Venture Corp - the largest capitalised stock in the information technology sector on the Singapore Exchange (SGX) - fell 64 cents to $26.92. The company released stellar fourth-quarter results with net profit up 165 per cent on the back of a 27 per cent improvement in revenue from a year earlier.

SGX fell one cent to $7.54. Israeli media reported that it has emerged as one of about 10 contenders for a controlling stake in the Tel Aviv Stock Exchange.

Yangzijiang Shipbuilding slipped six cents or nearly 4 per cent to $1.45 and was one of the day's most active with 26 million shares traded. The shipbuilder's fourth-quarter net profit jumped 12 per cent on the back of revenue gains of 15 per cent.

Noble Group slipped one cent or nearly 6 per cent to 16.2 cents, logging its sixth straight session of losses. The auditor of the embattled company warned about the group's ability to continue as a going concern as the struggling commodity trader announced a loss of US$4.94 billion (S$6.55 billion) for 2017.

A version of this article appeared in the print edition of The Straits Times on March 02, 2018, with the headline 'STI starts March on feeble note as Wall Street slides'. Subscribe