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AN afternoon reversal in Hong Kong and the Dow futures and a soft opening Europe-wide possibly because of weak oil prices on Wednesday put paid to hopes earlier in the day that the Straits Times Index could end the session in the black for the year.
After rising to an intraday high of 2,893, the index closed a net 4.79 points higher at 2,875.57, about seven points below its end-2015 level of 2,882. Turnover was relatively heavy at 886 million units worth S$1.2 billion and, excluding warrants, there were 202 rises versus 203 falls.
Banks were in focus, particularly DBS after it released its Q2 figures last week and disclosed its exposure to failed oil and gas (O&G) company Swiber Holdings.
Maybank Kim Eng maintained its "sell" on DBS, saying the latter's second-quarter results suggested that provisions may not be adequate and that there is broad-based asset quality deterioration in various areas including the O&G sector and in Hong Kong.
"We cut FY16-18E net profit by 4-9 per cent to reflect lower earnings and higher provisions," said the broker.