Tech jitters weigh on stocks; STI ends the day down 0.68%

SINGAPORE – Worries that an incoming Trump administration could heighten scrutiny of the global semiconductor supply chain knocked shares here and elsewhere on July 19.

The biggest hits came in the Taiwan and South Korea markets – both home to global chip champions. South Korea’s benchmark Kospi index fell 1.02 per cent, while the Taiex slipped 2.26 per cent.

Taiwan Semiconductor Manufacturing Co, the world’s largest independent foundry, has come under intense selling pressure since US presidential candidate Donald Trump’s suggestion that Taiwan is taking chip business from the US.

Singapore-listed stocks suffered a similar fate. Semiconductor equipment maker UMS Holdings fell 4.1 per cent to close at $1.17. Frencken Group lost 5 per cent to $1.51, while AEM Holdings, which provides testing solutions, declined 4.3 per cent to end the day at $1.80.

The tech weakness flowed through the local market, leaving the Straits Times Index (STI) at 3,447.56, down 23.6 points or 0.68 per cent, amid broad selling in the Asia-Pacific. Losers beat gainers 375 to 206 across the broader market on trade of 990 million shares worth $1.12 billion.

Only three of the 30 STI constituents ended the day in positive territory. Brewer Thai Beverage added 1 per cent to 50.5 cents, conglomerate ST Engineering closed 0.9 per cent higher at $4.45, and the Singapore Exchange put on 0.4 per cent to $9.77.

The decline here followed a night of red ink on Wall Street, where the Dow Jones Industrial Average plunged more than 500 points, or 1.3 per cent, to snap a six-session winning streak. The S&P 500 fell 0.8 per cent, while the Nasdaq Composite dropped 0.7 per cent.

Investors in the United States have been moving out of the giant tech stocks that have ruled the markets in 2024 and into firms that could benefit from rate cuts, such as smaller companies and more economically sensitive sectors like retail.

The same theme sent Australian shares down 0.8 per cent. THE BUSINESS TIMES