Singapore equities slide after North Korea missile test

This picture taken and released on July 4, 2017 by North Korea's official Korean Central News Agency (KCNA) shows the test-fire of the intercontinental ballistic missile Hwasong-14 at an undisclosed location.
This picture taken and released on July 4, 2017 by North Korea's official Korean Central News Agency (KCNA) shows the test-fire of the intercontinental ballistic missile Hwasong-14 at an undisclosed location.PHOTO: AFP

SINGAPORE - Claims by North Korea it had successfully tested an intercontinental ballistic missile on Tuesday (July 4) along with a rout in Hong Kong sent Singapore into negative territory.

The key Straits Times Index ended 0.38 per cent or 12.29 points lower at 3,211.17, weighed down by Genting Singapore, Jardine Cycle & Carriage, ST Engineering, Global Logistic Properties and OCBC Group.

Genting lost 1.8 per cent or two cents to $1.065; Jardine C&C shed 1.1 per cent or 48 cents to $43.56; ST Engineering dipped 1.1 per cent or four cents to $3.64; GLP fell 1.1 per cent or three cents to $2.82. OCBC slid 1 per cent or 11 cents to $10.61.

A 1.53 per cent dive in Hong Kong stocks after a selloff on internet giant Tencent fuelled growing concerns about risks in the world's fourth-largest equity market.

Aggravating investor sentiment was news that North Korea claimed to have launched a ballistic missile that appeared to have landed within Japan's exclusive economic zone, ahead of a Group of 20 summit later this week in Germany.

"Any time a ballistic missile lands in an economic zone, and this is the first time it has happened, then it becomes problematic," a remisier said.

Local tech manufacturing plays sank after heavy selling in US tech shares drove the Nasdaq Composite down 0.5 per cent, even as the Dow Jones Industrial Average rallied 0.6 per cent on Monday to its highest level on record.

 

Venture Holdings shed 1.3 per cent or 16 cents to $11.89, UMS Holdings dropped 1.5 per cent or 1.5 cents to 99.5 cents; and Hi-P International lost 1.1 per cent or one cent to 90 cents.

Bucking the downtrend, oil and gas plays extended gains even as oil prices retreated in Asian trade yesterday, snapping eight straight sessions of gains on signs that a persistent rise in United States crude production is running out of steam.

Keppel Corp gained 0.3 per cent or two cents to $6.34; Sembcorp Industries edged up 0.3 per cent or one cent to $3.13; Sembcorp Marine rose 0.6 per cent or one cent to $1.67. KrisEnergy jumped 8.2 per cent or 0.9 cents to 11.9 cents.

CapitaLand Commercial Trust rose 0.6 per cent or one cent to $1.675 on news that the Lian Beng Group and Apricot Capital, the private investment firm of Super Group's Teo family, have agreed to acquire Wilkie Edge, a mixed-use commercial and residential building near Little India for $280 million.

The rise came despite a "take profit" call from RHB, which cited concerns over "how management plans to offset the distribution per unit (DPU) shortfall arising from its recent divestments."

"With a strengthened balance sheet, we believe CCT could potentially acquire a minority stake in Asia Square Tower 2 along with CapitaLand. However, critical factors include the potential acquisition price and whether the acquisition would be yield-accretive," RHB Singapore property analyst Vijay Natarajan said.