AFTER the Straits Times Index (STI) dropped 14.3 per cent in 2015 amid ever-weakening liquidity, there were hopes - albeit faint - that 2016 might see the market enjoy an upturn in fortunes, even if almost all brokers and investment banks had issued negative outlooks for stocks.
No such luck. If traders here are to encounter better days ahead, they will have to wait a while longer - on the first trading day of the new year on Monday, the STI plunged 46.76 points or 1.6 per cent to 2,835.97.
This was in tandem with a 2.7 per cent loss in the Hang Sang Index, a 3.1 per cent fall in Japan's Nikkei 225 and, most relevantly, a 7 per cent collapse in the Shanghai Composite Index.
Last Friday's slide on Wall Street might have provided the initial trigger, though adding to the incentive to sell and keep selling was probably was a general loss of confidence in emerging Asia, starting with China and spreading to all other markets.
Not helping was news that China's factory activity contracted for the 10th consecutive month in December. The Caixin Purchasing Managers' Index, tracking activity in the factory and workshop sector, came in at 48.2 in December, down from 48.6 the previous month.
Such was the severity of the sell-off in Shanghai that newly installed circuit breakers were activated to stem the bleeding. In Shenzhen, the main market index crashed 8 per cent. Over in the futures market, the March futures for the Dow Jones Industrial Average recorded a 270-point loss in the late afternoon, thus adding to the pressure.