Bulls And Bears

STI ends roller-coaster week down 1.5%

After bright start to month, data calls into question resilience of US economy

Another week of trading, another roller-coaster ride for local investors trying to get a grip on market sentiment.

The Straits Times Index (STI) ended the week at 3,078.36, dipping 9.61 points or 0.3 per cent on the day while ending the week down 47.27 points or 1.5 per cent.

This month got off to a bright start with encouraging Chinese manufacturing data and Washington pushing back on reports that it plans to impose capital controls on China.

But it all changed by mid-week after disappointing United States manufacturing and employment data called into question the resilience of the US economy.

Concerns were only amplified on Thursday, when the American service sector - the key driver of the world's largest economy - fell to its weakest level in three years.

"This week's data suggests the US economy could be on the ropes after non-manufacturing new orders slumped in September: down like a tonne of bricks," AxiTrader Asia-Pacific market strategist Stephen Innes said.

President Donald Trump's impeachment saga and the opening of a new front to the trade war between the US and the European Union added salt to the wounds of bruised investors hoping for global trade skirmishes to go away.

The upside, if any, is the mounting expectation that the US Federal Reserve will lower rates this month.

Trading volumes here clocked in at 1.01 billion securities worth $799.97 million, with losers beating gainers 209 to 162.

The blue-chip index had 17 of its 30 counters closing in the red.

Golden Agri-Resources was the STI's most active with 28.7 million shares traded. The agri-business added 2.3 per cent to 22 cents.

The local banks ended lower. OCBC dropped 0.8 per cent to $10.62, UOB closed at $25.17, 0.6 per cent lower, and DBS edged down 0.1 per cent to $24.55.

Among second-liner counters, The Trendlines Group added 3.3 per cent to 9.5 cents. The Singapore Exchange had asked why it proposed a rights issue at a 19.3 per cent premium from its Sept 26 closing price of 8.8 cents. The Catalist-listed start-up incubator said its current market price "does not properly reflect the company's value".

Elsewhere, markets were similarly thwarted by the waning global outlook with Australia, Hong Kong, Malaysia and South Korea all ending with losses.

The Hang Seng made a sharp downturn in the afternoon after Hong Kong Chief Executive Carrie Lam invoked emergency powers for the first time in over 50 years to ban face masks for protesters.

A version of this article appeared in the print edition of The Straits Times on October 05, 2019, with the headline 'STI ends roller-coaster week down 1.5%'. Print Edition | Subscribe