STI closes 0.02% lower as traders digest weak China data

SINGAPORE – Local shares closed slightly lower on Tuesday, amid choppy trading in the wake of underwhelming April macro data out of China, which refreshed concerns that the reopening optimism from the world’s second-largest economy is fading.

The key Straits Times Index fell 0.68 points, or 0.02 per cent, to 3,214.04, snubbing overnight modest gains on Wall Street.

Key gauges across the region were mixed, with gains in Japan, Hong Kong, Taiwan, Malaysia and South Korea, while China and Australia finished lower.

China’s April data for industrial production and retail missed expectations, pointing to further signs of an uneven recovery. This raised concerns that economic recovery momentum has failed to sustain.

“The market’s expectations of the rebound in China may need to be toned down, as the slowdown in external demand is exerting a far greater downside pressure on China,” said UOB Global Economics and Market Research in a note.

“Furthermore, the latest data showed that China is still undergoing a property market downturn, which continued to hamper investment and keep the consumer sentiment soft.”

Overall trading sentiments were also cautious, owing to the United States debt ceiling stand-off and weaker economic data out of the US.

Back on the Singapore Exchange, some 1.4 billion shares worth $895.2 million were traded on Tuesday.

These include nearly 18 million shares of ComfortDelGro. The counter closed 1.7 per cent lower at $1.16. The transport operator on Monday reported a 57 per cent drop in profit to $33 million in the first quarter from a year ago, even as revenue improved by 2 per cent.

OUE Healthcare closed at a year-high of 3.1 cents, jumping 19.2 per cent. It was the third-most actively traded counter by volume on Tuesday, with 42 million shares traded after the launch of its new hospital in Changshu, in China’s Jiangsu province.

THE BUSINESS TIMES