Bulls And Bears

Weak global growth still weighs on markets

Traders hunt in vain for spark; local shares manage to put up positive performance

The last trading day of March went out with a whimper as investors looked in vain for inspiration.

Some pricked up their ears for signs of optimism from United States officials as they resumed discussions in Beijing.

US Treasury Secretary Steven Mnuchin said that he had a "productive working dinner" with Chinese negotiators the night before.

However, White House economic adviser Larry Kudlow warned that it could take weeks or months to secure a trade deal.

At least local shares turned in a positive performance, albeit a muted one.

The Straits Times Index closed up 9.30 points or 0.29 per cent to 3,212.88 and ahead 0.02 per cent for the week in which it spent more time treading water than moving up or down.

About 957.8 million securities worth $1.09 billion changed hands, with gainers outnumbering losers 216 to 165.

Offshore and marine group Marco Polo Marine led active trading in the quiet session, closing 11.76 per cent down at 1.5 cents with 48.6 million shares traded. The counter's trading volume hovers closer to one million on an average day.

Traders said they were unaware of what could have caused the spike in trading volume. One noted that the penny stock is a speculative one that can be tricky to trade.

Another active counter was Yangzijiang Shipbuilding, which was one of the 10 most active stocks by turnover this week. It closed up 0.67 per cent to $1.50 on trade of 23.3 million shares.

The shipbuilder had reported a 23 per cent year-on-year increase in full-year earnings on March 1.

Singapore Exchange market strategist Geoff Howie noted that it received $96 million in institutional inflow in the first quarter while its stock has gained 20 per cent after ending 2018 at $1.25.

Tee International retreated 3.39 per cent to 11.4 cents on a volume of 14.4 million shares. The engineering, infrastructure and real estate group said yesterday it had secured two new engineering contracts worth $22 million in total, bringing its order book to $506 million.

While the threat of weak global growth may have faded slightly into the background, it remains a key concern for markets in the near term, with DBS Bank rates strategist Eugene Leow calling it the "single largest challenge".

"Purchasing managers' index figures in Euro zone, China and Japan have not shown any signs of a turnaround. Export data across Asia have also been lacklustre. Accordingly, major central banks have turned dovish," he noted yesterday.

A version of this article appeared in the print edition of The Straits Times on March 30, 2019, with the headline 'Weak global growth still weighs on markets'. Print Edition | Subscribe