STI slips 0.57% ahead of key risk trigger - US labour market data release

SINGAPORE shares wrapped up the week’s trading on a low note, follwing the “Sell in September” theme, as caution ruled ahead of a key risk trigger – the release of US labour market data. If favourable, it could indicate that the US Federal Reserve has more room to aggressively raise rates.

The Straits Times Index (STI) retreated 18.39 points or 0.57 per cent to 3,205.69, finishing lower week-on-week by 43.84 points or 1.35 per cent.

Equity gauges in Japan, Hong Kong, Taiwan, South Korea and Australia slipped while Malaysia and China finished higher. Concerns persisted over the tightening trajectory with more hawkish talk from the US Fed while a string of data this week cemented fears over surging prices and slowing economic activity.

“The US jobs report could be a negative catalyst ... if it’s deemed strong enough to warrant more aggressive tightening from the Fed. We’ve seen a lot more risk aversion in the markets recently as Fed commentary has finally gotten through to investors,” said Craig Erlam, Oanda’s senior market analyst for UK and Europe, Middle East and Africa.

He added: “We’re still seeing remarkable resilience in the US data, particularly the labour market, even if some cracks are appearing elsewhere. While the NFP (non farm payrolls) and unemployment will naturally attract the most attention initially, it’s the wages that could tip the balance at the central bank, with policymakers concerned about inflation becoming entrenched.”

Some 1.41 billion units worth S$1.01 billion were traded in the local bourse. Losers outpaced gainers with 283 counters down, and 193 up.

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Emperador , the largest liquor company in the Philippines which is secondary listed on the Singapore Exchange, drew heavy trading volumes following news that the stock will be replacing ComfortDelGro as a constituent on the STI on Sep 19. Emperador shares rose S$0.015 or 3.03 per cent to S$0.51.

On the other hand, ComfortDelGro fell S$0.02 or 1.43 per cent to S$1.38.

GYP Properties outperformed the market with gains of S$0.002 or 1.06 per cent to close at S$0.19 on Friday, following news the previous day that the voluntary cash offer by Rumah & Co to take the real estate developer private was raised upwards to S$0.188 per share from S$0.168 per share.