Short-covering pares STI's loss for the week

LOCAL traders returned on Tuesday after a long National Day holiday weekend to news that China had decided to devalue its yuan, a shock move that sparked fears of a currency war and triggered waves of selling in global equities.

The Straits Times Index plunged 136 points on Tuesday and Wednesday, but was lifted by short-covering in the remaining two days. Friday's 22.47 points rise to 3,114.25 meant the loss for the week was trimmed to 82 points or 2.6 per cent.

At the height of the selling on Wednesday, turnover spiked up to over S$2 billion; on Friday, turnover was down to 1.3 billion units worth S$982 million. Over the four trading days, dollar turnover in index stocks contributed at least 70 per cent of total business.