The Singapore market snapped its five-day winning streak yesterday as Asian equities fell into the red, dragged down largely by Japan.
The benchmark Straits Times Index (STI) slid 18.58 points, or 0.65 per cent, to 2,843.8. This was even as Wall Street continued to ride on optimism that an interest rate hike this month is off the table, adding 0.37 per cent overnight.
Tokyo fell 0.97 per cent amid a stronger yen, while Seoul shed 0.14 per cent, Sydney dipped 0.15 per cent and Kuala Lumpur pared 0.44 per cent. Shanghai, Hong Kong and Taipei were closed for holidays.
China yesterday released data that showed deflationary pressures eased further last month, although consumer inflation came in below market expectations.
"The main driver is still the yen story," said Mr Kelvin Wong, City Index's chief technical strategist for Asia. "We now know June is a no-go for the next Fed rate hike, which has been good for the markets in the last few days. But a delay in rate hike has also seen the yen strengthening, which amplifies the lack of confidence in the Japanese market. And this has spilt over to markets in Asia as a whole."
At home, traders moved in for profit-taking on oil and gas-related plays as crude prices stayed close to their highest level this year.
Sembcorp Industries shed seven cents, or 2.3 per cent, to $2.95, while its rig-building arm Sembcorp Marine shaved 1.5 cents, or 0.9 per cent, to $1.71. Keppel Corporation slipped two cents, or 0.3 per cent, to $5.71.
Ascendas Reit, which said it is selling its A-Reit Jiashan Logistics Centre in China for $26 million, closed flat at $2.34.
An RHB Securities report called the divestment an "opportunistic move", given the attractive return.
"This is well aligned with its capital recycling strategy. Given that the Reit has announced two divestments in China in the past two weeks, this could signal that it may have an intention to allocate its resources elsewhere, such as Australia," it said, keeping a "buy" call on the stock with a $2.63 target price.
The day's only gainers were Global Logistic Properties, which rose 3.5 cents, or 1.9 per cent, to $1.85, and Singapore Airlines, inching up one cent, or 0.1 per cent, to $10.60.
Outside of the STI, agri-business Olam International eased one cent, or 0.5 per cent, to $1.89, following a morning announcement that it has acquired Alabama's biggest peanut sheller, Brooks Peanut Company, for US$85 million (S$114.6 million).
Offshore marine group Otto Marine shot up 8.5 cents, or 37 per cent, to 31.5 cents, after executive chairman and controlling shareholder Yaw Chee Siew proposed a $68 million delisting offer.
The most active counter was AusGroup Singapore, which jumped 0.6 cent, or 8 per cent, to 8.1 cents on a turnover of 95.4 million units.
Total trade across the bourse came up to 1.05 billion shares worth $913.1 million.