STI slides as market braces for bad news from PM Lee's virus update

THE Straits Times Index (STI) closed down 45.93 points or 1.77 per cent at 2,551.92 on Tuesday as punters braced for bad news following Prime Minister Lee Hsien Loong's 4pm announcement that he would address the nation at 5pm on live television.

During his address, he announced a four-week extension to June 1 of the partial lockdown measures.

About 1.63 billion securities worth S$1.47 billion changed hands on Tuesday. Losers outnumbered gainers 341 to 111. The top active counter was Biolidics, which jumped 40.79 per cent or 15.5 Singapore cents to S$0.535.

Sevak was the top gainer, rising 11.33 per cent or S$0.17 to S$1.67. Jardine Matheson was the top loser for the second day running, falling 2.10 per cent or US$1.08 to US$50.40.

The market was bearish after May futures contracts for the US crude oil grade West Texas Intermediate (WTI) turned negative for the first time.

But Bank of Singapore currency strategist Sim Moh Siong noted: "The WTI oil market is a reflection of the supply glut in Cushing, not a reflection of the international oil market, which more closely follows Brent crude."

The market is also weighing the fallout from the oil rout, not just for oil and gas players but for their counterparties too.

In a report last Friday, UOB Kay Hian analyst Jonathan Koh said he expects DBS Group's net profit to fall by 25 per cent in the first quarter from the same period a year earlier when it reports on April 30.

"Management disclosed that DBS's exposure to offshore support vessels is currently at S$3 billion, which is halved compared to S$6 billion at end-2016," he said. "We have assumed new non-performing loans of S$971 million during the quarter (Q4 2019: S$575 million)."

Regional markets were awash with red. The Hang Seng and KLSE both fell 2.22 per cent.

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