STI falls on likely December US rate hike

NEWS from the US that the Federal Reserve has left the door open for an interest rate hike in December probably led to Thursday's 39-point or 1.3-per-cent loss for the Straits Times Index (STI) at 3,001.51.

Alternatively, it could also be that the index, having bounced 342 points from its intraday low of 2,940 on Sept 29 to Monday's closing of 3,082 - a gain of 12.5 per cent in three weeks - was due for a correction, regardless of the news or external backdrop. If so, then its third consecutive loss since Monday brought the correction to 82 points or 2.6 per cent.

In any event, volume remained low and focused mainly on index stocks. Total turnover amounted to a weak 1.2 billion units worth S$957 million, of which S$683 million or 71 per cent was done in the 30 STI members. Stripping out these 30 left 915 million units worth S$274 million which was done by the rest of the market, the unit average value of S$0.30 placing interest firmly in penny territory.