Singapore: Shares close mixed on Friday; STI rises amid a weak broad market

LOCAL traders returned on Tuesday after a long National Day holiday weekend to news that China had decided to devalue its yuan, a shock move that sparked fears of a currency war and triggered waves of selling in global equities.

The Straits Times Index (STI) plunged 136 points on Tuesday and Wednesday but was lifted by short-covering in the remaining two days. Friday's 22.47 points rise to 3,114.25 meant the loss for the week was trimmed to 82 points or 2.6 per cent. The broad market was weak on Friday, with 195 rises versus 241 falls.

At the height of the selling on Wednesday, turnover spiked up to over S$2 billion; on Friday, turnover was down to 1.3 billion units worth S$982 million. Over the four trading days, dollar turnover in index stocks contributed at least 70 per cent of total business.

Most of the falls and subsequent rises posted by the STI were caused by movements in the banks and Singtel. For banks, analysts grappled with the issue of whether earnings would be badly affected by a weaker yuan; for Singtel, release of its first-quarter results provided the market with a tradeable opportunity.

Elsewhere within the index, shares of commodity trader Noble Group were in focus after the it released its latest figures as well as a report by PricewaterhouseCoopers on the group's accounting practices and treatment of its mark-to-market contracts.

After a brief bounce to around S$0.64 early in the week, the stock came under pressure, finishing the week at S$0.49 for a loss of S$0.09 or 15.5 per cent over the four days.