SINGAPORE - Local shares remained in the red on Tuesday, after another tepid session where investors mostly stayed on the sideline to avoid uncertainties piling up on both the domestic and foreign end.
The benchmark Straits Times Index (STI) dropped another 29.53 points or 1.03 per cent to 2,841.94, worsening from Monday's 0.6 per cent loss.
Across the whole market, around 1.32 billion shares that were worth S$1.42 billion changed hands, but the unusual strong volume was resulted from a married deal over Olam International, which was the top active counter on Tuesday with some 222 million shares transacted.
This was the amount that Mitsubishi Corporation agreed to acquire from Olam's founding members Kewalram Chanrai Group at S$2.75 apiece, as part of its deal to partner with the commodity company. Olam closed up 1.5 cents or 0.76 per cent at S$2.
Otherwise, the market was largely quiet, remisier Alvin Yong said, adding: "I see some portfolio rebalancing, with some people bargain hunting among the small and mid-caps while many others took their money off the table.
"The Fed rate hike is still on investors' mind. I believe there's a good chance that it will be announced this week, and if so we will see the market trading sideways with a bearish bias for at least the near term."
Twenty-two blue chips on the STI closed lower, and Noble Group was the top losing counter of the bunch, down 1.5 cents or 3.16 per cent to 46 cents.
The banking stocks struggled, with DBS paring 13 cents or 0.74 per cent to close at S$17.49. OCBC dropped seven cents or 0.78 per cent to S$8.92, while United Overseas Bank closed 18 cents or 0.92 per cent down at S$19.30.
Stocks of the trio have yet to benefit from the hiking of the Singapore Interbank Offered Rate, which is currently around its seven-year high.
"This should improve the banks' margins going forward, but banking is a proxy of economy, and Singapore's outlook is not looking good with economists downgrading their forecasts left and right," Mr Yong said.
On the other end of the ledger, SIA Engineering was the top gaining blue chip, up eight cents or 2.24 per cent to close at $3.65. Genting Singapore also gained, rising one cent or 1.39 per cent to 73 cents.
Overseas markets were a mixed picture. Kuala Lumpur rose another 0.46 per cent as the cheering mood over the government's freshly announced stimulus measures continued. Tokyo similarly gained on good news, up 0.34 per cent after the central bank pledged that it will maintain its stimulus measures.
In China however, sentiments were more downbeat amid persistent signs of economic slowdown. Shanghai was down 3.52 per cent and Hong Kong pared 0.49 per cent.