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Singapore shares open 22.91 points lower on Friday

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SINGAPORE stocks opened lower on Friday as investors toned down their surprise at oil-producing countries' commitment to cut production while fears of woes at Deutsche Bank crept in.

By 9.02am, the benchmark Straits Times Index (STI) had slid 22.91 points or 0.79 per cent to 2,862.80.

A total of 141.1 million shares worth S$189.5 million changed hands, with 99 losers to 35 gainers.

Bank stocks were some of the biggest losers in the initial minutes of trading, with DBS, OCBC and UOB all appearing on the list.

The Organization of the Petroleum Exporting Countries shocked markets on Wednesday with a deal to cut oil output after kingpin Saudi Arabia allowed bitter rival Iran to be exempted, but analysts warned on Thursday the move would not likely have a lasting impact, AFP reported.

The cartel's announcement of the first reduction in eight years sent crude prices surging up to 6 per cent on Wednesday, while energy firms in the United States and Asia followed suit with huge gains.

In Singapore, it has helped push the STI back to positive territory for the year. It closed on Thursday with a 27.7-point or 0.97 per cent gain at 2,885.71, about three points into the black for 2016.

Investors here then pulled back on optimism on Friday morning, aided by fears of systemic risk in the financial sector due to problems at Deutsche Bank.

Deutsche Bank's stock and debt have been under pressure after the US Justice Department this month requested US$14 billion to settle an investigation into residential mortgage-backed securities, Bloomberg reported. Hedge funds that do business with the German lender then moved to reduce their financial exposure.