A bull in a China shop

SINGAPORE'S stock market closed one per cent lower on Tuesday with the Straits Times Index retreating 32.33 points or one per cent to 3,281.09. Penny stock activity was rampant. Some 2.3 billion shares worth S$1.37 billion in total changed hands, which worked out to an average unit price of S$0.60 per share.

As their far larger counterparts on the mainland bourses continued to slump, Singapore penny stocks with "China" attached to their names ran wild.

Exhibit A is Chinese Global Investors Group, hitherto a sleepy micro-cap involved in a waterproofing business and holding on to some equity investments.

It was the most actively traded, down S$0.006 to S$0.057 with 267.9 million shares changing hands, a total value traded of S$19.5 million. Interest picked up after the company announced the acquisition of Success Finance Limited, a moneylender in Hong Kong.

Meanwhile, an interesting disclosure on Tuesday afternoon was made by CEFC International, a fuel trader that has rallied sharply in recent weeks after saying it was in discussions on potential joint ventures, including one to acquire a company building port facilities and cargo transportation in China. It revealed its latest shareholding statistics as at July 24, 2015. This can be contrasted to shareholding statistics as at March 13, 2015.

Controlling shareholder Singapore Petrol Development has its stake unchanged at 76.58 per cent. Share movements have taken place across nominee accounts, with OCBC Securities and DBS Vickers accounts adding more shares, while Phillip Securities shed some holdings.

Shares have also changed hands among top individual shareholders.

Tan Hui Har, previously fourth-largest shareholder who had 55 million shares, is no longer in the list of the top 20 shareholders. Gone from the list too are Ong Ah Whatt (9.9 million shares) and Joshua Chua Jian Min (five million shares).

Previously 11th largest shareholder Luan Wenbo has increased his holdings from 18.8 million shares to 30.7 million shares. New shareholders in the top-20 list include Wu Dongxu (16.3 million shares), Liu Jingdong (4 million shares) and Li Hung (4 million shares).

Shareholders appear to have cashed out. The company has 1,442 shareholders as at July 24, compared to 1,659 a few months ago. Moving on, China Bearing (Singapore), which makes ball and roller bearings for automobiles, equipment and machinery, requested a trading halt on Tuesday morning pending the release of an announcement. This was after the company shot up 17 per cent on Tuesday to 4.8 Singapore cents, on a volume of 56 million shares, up from 27.6 million shares traded on Monday.

Then there is potato processor China Essence Group, which recorded no revenue for its financial year ended March 31, 2015. The counter rose 162.5 per cent to 2.1 cents on 146 million shares traded, drawing a query from Singapore Exchange. The frenzy comes without an announced explanation. The company said on Monday that auditors BDO LLP have resigned due "the independence threat arising from the long outstanding audit fees owing by the company". A company secretary and an independent director had also resigned in recent months.

China Essence wrote off all its property, plant and equipment in its latest results. The impairment loss was around 450 million yuan (S$99 million). Also active were stocks such as China Sports International and China International Holdings. Back to the blue chips, rigbuilder and property play Keppel Corp fell below S$8 for the first time since last December, when oil prices were crashing. It was at S$7.95, down 13 cents or 1.6 per cent, at the close of trading.

A number of stocks hit fresh lows. Commodity trader Noble Group fell to 59.5 Singapore cents, down 2.5 cents or 4 per cent. Palm oil play Golden Agri-Resources also fell to 34 Singapore cents, down two cents or 5.6 per cent.

A DBS Group Research note on exchange-traded fund strategy said: "Global growth downgrade trend is on-going. . . Risk is still on the downside. We are still cautious on rest of emerging market Asia as they remain vulnerable to a stronger US dollar and higher yields. Hong Kong H-shares and the Hang Seng Index are our best picks."

For full listings of SGX prices, go to http://btd.sg/BTmkts