Singapore shares fall amid fears of further rate hikes; STI down 0.1%

THE Straits Times Index (STI) fell 0.1 per cent or 3.87 points to 3,214.21 on Wednesday (May 24), amid fears of further rate hikes.

Across the broader market, losers beat gainers 295 to 245 after 1.2 billion securities worth S$898 million changed hands.

Markets in the region were also in the red. Hong Kong’s Hang Seng Index fell 1.6 per cent, and Japan’s Nikkei 225 fell 0.9 per cent; South Korea’s Kospi closed flat.

IG market analyst Yeap Jun Rong noted that expectations of a pause in the Federal Reserve’s rate hikes were “shaken” by hawkish remarks from Fed officials, as well as a stronger-than-expected Purchasing Managers’ Index (PMI) in the US.

S&P Global’s flash US composite PMI output index rose to a reading of 54.5 in May, from a final reading of 53.4 in April. A figure above 50 indicates growth in the private sector.

Yeap also observed further de-risking on Wall Street overnight, as the lack of any significant progress in US debt talks led major indices lower.

“The absence of any signs of progress will likely keep a cautious lid on market sentiments for now, with the VIX jumping 8 per cent overnight, but the sharp moderation in US one-year credit default swaps lately still reflects some optimism of an eventual resolution,” he said.

On the STI, CapitaLand Investment was the largest gainer. Its shares rose 1.7 per cent or S$0.06 to close at S$3.51.

Genting Singapore was at the bottom of the table, shedding 2 per cent or S$0.02 to S$1.00.

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The trio of banks were also in the red. OCBC shed 0.5 per cent or S$0.06 to S$12.20, UOB shed 0.4 per cent or S$0.12 to S$27.83, and DBS fell 0.3 per cent or S$0.09 to S$31.40.