Singapore stocks lose steam as SIA sinks, Fed stands pat; STI drops 1%

SINGAPORE equities were in the red on Thursday (Aug 1), after the US Federal Reserve stood pat in its July meeting, but signalled it could be ready to start cutting rates as early as September.

The Singapore Exchange’s blue-chip barometer, the Straits Times Index (STI), descended 1 per cent or 36.1 points to 3,419.84.

Across the broader market, losers outnumbered gainers 291 to 273, as 1.3 billion shares worth S$1.7 billion changed hands.

Regional markets largely brushed off the Fed’s decision. Hong Kong’s Hang Seng Index slid 0.2 per cent, while the South Korean Kospi Composite Index rose 0.3 per cent. Bursa Malaysia Kuala Lumpur Composite Index ticked down 0.1 per cent.

Japan’s Nikkei 225 sank 2.5 per cent, a day after the Bank of Japan hiked interest rates.

“There were indications that the Fed was becoming more sensitive to the risks of cutting too early or too late as it recognised the need to balance both sides of their dual inflation-employment mandate,” said Maybank analysts in a note.

In Singapore, the STI was dragged by Singapore Airlines . The national carrier on Wednesday posted a net profit of S$451.7 million in the first quarter, a 38.5 per cent drop from S$734 million in the year-ago period.

The counter sank 10.5 per cent or S$0.73 to S$6.24, from Wednesday’s closing price of S$6.97. It began trading ex-dividend on Thursday morning, following the airline’s full-year dividend per share of S$0.38.

The index was topped by Frasers Logistics & Commercial Trust , which rose 3 per cent or S$0.03 to S$1.02.

SEE ALSO

Likely September Fed rate cut will boost Asian bonds, equities: analysts

Hot stock: SIA shares fall on Thursday after Q1 earnings miss

The local banks all fell. UOB slid 1 per cent or S$0.31 to S$32.04, OCBC declined 0.2 per cent or S$0.03 to S$14.82. DBS was the biggest loser of the three, contracting 1.7 per cent or S$0.61 to S$35.98.