STI falls 0.8% after Powell warns of more rate hikes
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SINGAPORE shares finished lower on Monday (Aug 29) amid broad losses across most major Asian markets, as trading sentiments were battered by US central bank chief’s remarks that more rate hikes are to be expected given stubborn inflation.
The key Straits Times Index slipped 27.27 points or 0.84 per cent to 3,222.26. Elsewhere, key indices from Japan, Hong Kong and Taiwan to South Korea finished lower. China and Malaysia bucked the trend with marginal gains.
“This new higher for longer interest rate guidance from (Jerome) Powell has effectively put to rest expectations that the US central will ease monetary policy soon, or even cut rates in early 2023. It brought markets back to the reality and it spooked investors, causing a sell-off on Wall Street last Friday,” noted OCBC Bank’s executive director of investment strategy Vasu Menon.
He added: “Looking into September - markets may also be headed for greater volatility when fund managers and investors return from their summer holidays at the start of September. The new interest rate guidance from Jackson Hole and uncertainty about the outcome of the next Fed policy meeting in late September, will keep investors on the edge in the coming weeks and calls for caution.”
Some 1.34 billion units worth S$975.18 million were traded on the Singapore bourse as losers outpaced gainers with 349 counters down and 159, up. Losses were led by Singapore’s banking trio DBS , OCBC and UOB as well as Singtel and the Singapore Exchange .
The market cheered Thomson Medical Group for its sterling H2 2022 report card. The company’s net profit jumped nearly 7 fold to S$41.3 million from a year ago on higher patient load and average bill sizes. Its board also proposed a record special dividend of 0.115 Singapore cent per share for the full year versus 0.015 cent in the year-ago period. The stock gained S$0.001 or 1.14 per cent to S$0.089.
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Micro-Mechanics released its “highest-ever” quarterly results for the 3 months ended Jun 30 over the week, reporting a 23 per cent jump in net profit to S$5.9 million from a year ago. The counter of the semi conductor firm advanced S$0.040 or 1.29 per cent to S$3.14.
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