Banks drag STI lower in drab session

SELLING of the three banks on Tuesday left the Straits Times Index nursing a 9.76-point loss at 3,204.79 in thin trading of 1.1 billion units worth S$612.8 million.

The closure of Wall Street on Monday for Memorial Day and Hong Kong on Tuesday, together with Shanghai and Shezhen for the Tuen Ng Festival were the main reasons for the lethargy here, though the slight weakness in the Dow futures did affect sentiment. The broad market recorded only 143 rises versus 246 falls, excluding warrants.

Traders said they were waiting for direction from Wall Street, where investors have positioned themselves for large defence and infrastructure spending by the government which would boost the economy after a weak first quarter, and an interest rate hike in mid-June.