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Singapore shares close weaker but off their intraday lows
THE Straits Times Index opened the week with its seventh consecutive loss, dropping 9.95 points at 2,915.73. The selling was said to be partly a knee-jerk reaction to the weekend's terror attacks in Paris, though a wobbly Friday session on Wall Street before those attacks also played a major role in the selling here.
In total, the STI has lost 124 points or 4.1 per cent since it closed at 3,039 on Wednesday, Nov 4, one of its worst losing streaks in a weak year for equities overall. Monday's loss, however, could have been a lot worse if not for a rise in the Dow futures - at its intraday low of 2,885 the index had at one stage lost 40 points.
The Paris attacks were cited as a probable factor influencing local sentiment, though few thought that it would have a lasting effect. For instance, DBS's chief investment officer, Lim Say Boon, in his Monday Asian Insights said geopolitical events, acts of terror, natural disasters, and pandemics have historically not tended to have large and sustained impact on markets.
"In short, markets are moved by things that impact corporate earnings," wrote Mr Lim. "So if geopolitical events do not significantly impact economic and corporate earnings trends, they will peter out beyond any initial response."
In keeping with trading for most of the year, volume was low. A total of 1.2 billion units worth S$938 million was done, of which 300 million units worth S$618 million were in trading of the 30 STI members. Excluding warrants, there were 175 rises versus 248 falls.