Singapore shares dampened by Fed rate-hike expectations

SINGAPORE – The growing prospect of further interest rate hikes from key central banks spooked local investors and helped send the market down a touch on Thursday. The downbeat sentiment left the Straits Times Index off 10.64 points or 0.3 per cent to 3,313.41. Gainers beat losers 304 to 246 on the broader market, with turnover of two billion shares worth $1.2 billion.

The US Federal Reserve’s report on economic conditions out on Wednesday showed that lending volumes and loan demand generally declined in recent weeks in the United States, although overall economic activity was little changed.

Some analysts said it should not interfere too much with the market’s 89 per cent probability pricing of a 25 basis-point rate hike by the Fed on May 3.

Regional markets struggled to find direction. The Hang Seng in Hong Kong inched up 0.14 per cent and the Nikkei in Tokyo added a modest 0.18 per cent, while the Australian bourse closed largely unchanged. But the Kospi in Seoul dropped 0.46 per cent and Shanghai was off 0.1 per cent.

The region’s mixed performance followed a lacklustre session on Wall Street overnight.

The S&P 500 and the tech-heavy Nasdaq ended flat while the Dow Jones Industrial Average dipped 0.2 per cent.

One of the more notable movers in Singapore was Nanofilm Technologies, which plunged 9.1 per cent to $1.50 after the mainboard-listed firm, which has plants in China, announced a 40 per cent fall in revenue for the first quarter.

The nanotech company said its first quarter is typically cyclical in line with production cycles, while sales were also hit by China’s slow and soft recovery since reopening its borders. Still, it was below analysts’ consensus forecast.

Azeus Systems, which supplies software for hosting meetings remotely, closed 3.5 per cent higher at $8.59, a day after media reports that the Singapore Exchange has amended rules to enable the conduct of general meetings by electronic means. THE BUSINESS TIMES