Singapore shares close weaker; STI down for seventh straight session

THE Straits Times Index (STI) kicked off the week with a seventh straight loss on Tuesday, dropping 27.32 points to 2,811.20. Turnover remained meagre at 901 million units worth S$1.08 billion and excluding warrants there were 151 rises versus 258 falls throughout.

A steep fall in Hong Kong of almost 2 per cent for the Hang Seng Index that was attributed to disappointing manufacturing numbers announced by China and a 100-point drop in the Dow futures were blamed for the selling here.

The STI has now lost 150 points or 5 per cent since closing at 2,960.78 on April 21. Volatile oil prices, an uncertain Wall Street and general worry about the state of the global economy have been the main drags.

DBS was the last of the three banks to release its first-quarter figures, announcing a 6 per cent rise in net profit to S$1.2 billion before trading commenced on Monday. In response, its shares rose S$0.07 to S$15.35 on volume of 7.2 million. The other two, however, did not fare as well - UOB dropped S$0.20 to S$18.40 on turnover of three million and OCBC lost S$0.17 at S$8.60 with 11.2 million traded.

For OCBC, brokers RHB said that it has trimmed its earnings projections slightly after taking into account weaker-than-expected profit from life insurance and fee income.

"Our Gordon Growth Model-derived target price is lowered to S$9.50 (from S$9.60), based on 1.1x revised book value (-1 standard deviation from historical mean of 1.14x)," added RHB. "OCBC's share price recovered from the low of S$7.45 in mid-February, to a high of S$9.45 in mid-April."