STI posts slight losses on Friday but adds 1.2% on the week

MARKETS got increasingly confident as the week progressed due to a de-escalation in the trade dispute between the US and China.

But it was really the effect of Hong Kong chief executive Carrie Lam's significant concession - the full withdrawal of the extradition bill - that proved to be the difference for Asian markets which gained this week.

On Friday, Singapore's Straits Times Index (STI) did, however, slip late in the session, bucking the regional trend to end at 3,144.48, down 2.58 points or 0.1 per cent.

The blue-chip index added 37.96 points or 1.2 per cent from last Friday's close of 3,106.52.

Elsewhere in the Asia-Pacific, key markets Australia, China, Hong Kong, Japan, Malaysia and South Korea all finished higher.

The Hang Seng gained 0.7 per cent to 26,690.76. The Hong Kong benchmark gained 3.8 per cent this week, its biggest weekly gains since June.

Effects from the removal of the extradition bill and hopes that trade issues will be resolved made for a risk-on day for markets.

"Only a presidential tweet could take the wind out of Asia's sails this (Friday) morning," Oanda Asia Pacific senior market analyst Jeffery Halley noted, referring to US President Donald Trump's penchant for swaying market sentiment by tweeting.

Thankfully, such a tweet did not materialise and investor optimism was not derailed during Friday's session.

FXTM senior research analyst Lukman Otunuga acknowledged that the improved market mood was welcomed but cautioned that gains could be capped by eventual investor scepticism.

"Lessons from the past have certainly illustrated the unpredictability of the Trump administration when it comes to trade developments," he added.

In Singapore, trading volume clocked in at 897.04 million securities, three-quarters the daily average in the first seven months of 2019.

Total turnover was S$1.01 billion, 95 per cent of the January-to-July daily average.

Across the market, advancers trumped decliners 208 to 158. The blue-chip index had six of the 30 counters closing in the red.

For each trading day of the week, Yangzijiang Shipbuilding was the most active counter on the STI.

On Friday, the shipbuilder closed 1.5 Singapore cents or 1.6 per cent higher at 98 cents, with 43 million shares changing hands.

The local banks also closed higher. DBS Group Holdings added S$0.13 or 0.5 per cent to close at S$24.76; OCBC Bank was S$0.08 or 0.7 per cent up at S$10.85 and United Overseas Bank ended at S$25.50, up S$0.24 or 0.9 per cent.

Following news that Hutchison Port Holdings Trust (HPH Trust) will be dropped from the STI on Sept 23, its units edged down 0.1 US cent or 0.6 per cent to 15.6 US cents.

Meanwhile, Mapletree Commercial Trust, which will join the STI in place of HPH Trust, fell four cents or 1.8 per cent to S$2.24.