Bulls And Bears

STI subdued on US political uncertainty

Property plays posted mixed results while Sats and SIA provided some lift to the market

Local shares were muted yesterday amid political uncertainty in the United States and weaker manufacturing sentiment in China.

The uncertainty left the Straits Times Index (STI) down 1.89 points or 0.06 per cent to 3,374.08 on turnover of 2.139 billion shares.

It was a mixed bag for property stocks, as developer Roxy-Pacific Holdings lost one cent or 1.7 per cent to 57 cents on news that third-quarter earnings fell 82 per cent.

Retail player Starhill Global Reit, which last week reported a 3.5 per cent drop in first-quarter net property income on the previous year, finished lower by half a cent or 0.6 per cent at 77 cents.

But Ascendas Reit, which deals in industrial sites in Singapore and Australia, put on three cents or 1.1 per cent to $2.74.

This followed a 5.3 per cent year-on-year rise in net property income in the second quarter.

Phillip Securities Research analyst Richard Leow, sticking to a “buy” call with a target price of $2.86, called the results “stable and uneventful”, with the outlook for the Reit similarly stable.

City Developments added 18 cents or 1.4 per cent to $12.94.

Hutchison Port Holdings Trust, which posted a 37 per cent year-on-year drop in third-quarter profit on Monday, shed half a US cent or 1.1 per cent to 43 US cents.

OCBC Investment Research analyst Deborah Ong raised her recommendation on the stock to "hold", citing effective cost management, but kept her target price unchanged at 42 US cents.

Investment holding company KTL Global, which deals in offshore and marine equipment, shed 0.6 cent or 14.3 per cent to 3.6 cents.

Its board said late on Monday that the chief executive is assisting the authorities in a probe over a possible offence under the Securities and Futures Act.

The day ended brighter for Changi Airport service provider Sats, which has struck a deal with Malaysia's AirAsia to swop stakes in each other's ground-handling business. The counter added one cent or 0.2 per cent to $4.70.

This is a positive strategic move for Sats, said DBS Equity Research analysts Alfie Yeo and Andy Sim, "as it now has a stake in a Malaysian ground-handling business to add to its network".

Singapore Airlines rose two cents or 0.2 per cent to $10.27.

Hong Leong Asia, which announced on Monday a restructuring exercise for a household appliance unit in China, was higher by 2.5 cents or 2.1 per cent at $1.225.

The biggest headwind for Asian markets, according to IG Asia market strategist Pan Jingyi, was likely uncertainty over the prospects of Republican tax reform in the US, as well as the lift in risk sentiment as the first charges were made public in an election interference probe.

Tokyo was flat yesterday, while Shanghai finished up by 0.09 per cent and Seoul by 0.86 per cent.

Correction note: In an earlier version of this story, we said Phillip Securities Research analyst Richard Leow was sticking to a “hold” call. This is incorrect.  He was sticking to a “buy” call with a target price of $2.86. 

A version of this article appeared in the print edition of The Straits Times on November 01, 2017, with the headline 'STI subdued on US political uncertainty'. Print Edition | Subscribe