STI slides 0.8% as investors turn cautious amid Fed’s rate-cut uncertainty
Most Asian stocks end down, and the upcoming US polls add to investor caution
THE prospect of the Federal Reserve delaying its rate cuts or dishing out a smaller snip made investors cautious on Tuesday (Oct 22), and sent Singapore and most regional stocks to finish lower.
The Straits Times Index (STI) slid 27.17 points or 0.8 per cent to 3,587.41 points, with only three stocks in the 30-counter benchmark ending higher. Another three were flat and the remaining 24, in the red.
LGT Private Banking wrote a note on Tuesday that the US 10-year Treasury yield rose over 10 basis points to 4.21 per cent, reflecting expectations that the Federal Reserve may delay rate cuts on the back of economic resilience.
Asian stocks mostly dipped because of the uncertainty over the US central bank’s decision on interest rates; the upcoming US presidential election also discouraged risk-taking.
But Chinese markets rose as the interest rate cut by the People’s Bank of China was steeper than street expectations.
Sembcorp Industries was the top loser on the STI tally, falling 2 per cent or S$0.11 to S$5.40. The Singapore renewable- and low-carbon-energy player had on Monday announced a deal with an Indonesian electricity producer to produce 100,000 tonnes of green hydrogen a year.
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Singapore Airlines (SIA) , logged a 1.7 per cent or S$0.11 dip to S$6.39. The airline is expected to continue to experience “a downdrift in earnings”, said CGS International analyst Raymond Yap in a report on Monday, ahead of the release of SIA’s first-half financial results on Nov 8.
Yap recommended “reduce” on the stock, but without reducing its target price of S$5.88.
Across the broader market in Singapore, losers beat gainers 262 to 235, with 1.1 billion securities totalling S$1 billion in value having been traded.
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