Singapore stocks decline 1.5 per cent in August; market cap at lowest since March

THE total market capitalisation of Singapore stocks fell by 1.5 per cent to its lowest level since March this year.

The Catalist market cap saw a steeper decline of 4.1 per cent.

The total market capitalisation for the 669 companies on the Singapore Exchange (SGX) was S$846.1 billion, 1.5 per cent or S$12.8 billion lower than the figures in July, going by data compiled by The Business Times.

Losers beat gainers 328 to 178.

The market value of the 30 constituent stocks on the blue-chip Straits Times Index (STI) fell by more - 3.6 per cent. Accounting for dividend distributions during the month, its market value fell by 2.4 per cent.

Yangzijiang Shipbuilding was the STI's strongest stock, gaining S$1.07 billion in market capitalisation in August. The company reported a net profit of 1.6 billion yuan (S$339.6 million) for the first half of the year, up 39 per cent from the year-ago half year. The group also announced that it had new orders for 112 new vessels - a record number - in the first half of this year, with a total contract value of US$6.67 billion.

Jardine Matheson Holdings (JMH) was the STI's overall biggest loser, losing S$5.59 billion in market capitalisation; it was also the top loser on the bourse in August.

The mainboard market capitalisation, at S$833.9 billion, was 1.4 per cent or S$12.2 billion lower; on the Catalist, listed firms' market capitalisation came in at S$12.2 billion, down S$0.5 billion or 4.1 per cent in August.

The trio of local banks averaged a 2.0 per cent decline in total return in August, including dividend distributions, which brought their average eight-month gains to 19.2 per cent.

SGX market strategist Geoff Howie noted that the trio outpaced their global peers by 4.5 per cent in July, but then lagged them by 5.5 per cent in August.

Looking ahead, Mr Howie noted that the rebalancing of the MSCI Singapore Index to increase Singapore-based Sea Ltd's weight, as well as increased global investor attention on the technology sector, may further affect the performance of banks on the market.

The technology sector was strongest across the globe in August, with indices such as the Philadelphia Stock Exchange Semiconductor Index gaining 5.8 per cent since Aug 20. Local equities AEM holdings, UMS holdings and Frencken Group have followed suit, averaging 5.7 per cent in gains.

Notably, Nanofilm was the fifth biggest loser on the market, shaving S$1.22 billion off its market capitalisation. This comes after the company posted a 3.1 per cent decline in net profit for the first half of the year, amid higher costs in manpower and manufacturing overheads.

DBS analyst Ling Lee Keng had sounded a note of caution earlier about the uncertainty hanging over the company's leadership: Its chief executive officer and chief operating officer stepped down in a space of two months.

Aside from technology, the agriculture sector was the fastest-growing on the bourse this month, growing its market capitalisation by 2.7 per cent to S$8.8 billion.

Agri-food giant Olam International and palm oil producer First Resources were among the top 10 gainers in August, logging gains in market capitalisation of S$1.03 billion and S$174.3 million respectively.

Mr Howie noted that this comes on the back of strengthening global commodity prices in August, with Malaysia crude palm oil futures trading up 18 per cent in the year to date.