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Singapore shares drop 0.7% amid trade war fears, HK protests

THE Singapore market returned from the four-day weekend to an environment blighted by fears of a long-drawn trade war between the US and China, protests in Hong Kong and to a lesser extent, Argentines turning on their incumbent president in a primary vote.

Local equities were also weighed down by investor sentiment on Singapore's economy after Q2 non-oil domestic exports tumbled 14.6 per cent year-on-year, and the city-state cut its Gross Domestic Product (GDP) forecast to between zero growth and 1 per cent for the full year.

With these factors in play, a knee-jerk sell-off ensued shortly after market open, with the Straits Times Index (STI) down by 1 per cent just after opening before ending at 3,146.73, down 22.21 points or 0.7 per cent on Tuesday.

Jeffrey Halley, Oanda's Asia-Pacific senior market analyst, noted with Singapore being a free market and a global bellwether economy, "its consistent run of poor data is cause for concern, both regionally and globally".

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Elsewhere in the Asia-Pacific, shares in Australia, China, Hong Kong, Japan, Malaysia and South Korea were in the red.

In Singapore, trading volume clocked in at 1.37 billion securities, 14 per cent more than the daily average in the first seven months of 2019. Total turnover came to S$1.52 billion, 43 per cent over the January-to-July daily average.

Across the broader market, decliners trumped advancers 299 to 156. The blue-chip index had 15 of the 29 counters in trading, ending lower. Yangzijiang Shipbuilding shares remain halted since last Thursday when reports emerged of Beijing's probe into an individual linked to the firm.

Singtel, which fell S$0.08 or 2.5 per cent to S$3.18, was the benchmark index's most traded stock with 37.5 million shares changing hands in the session after the telco recorded first-quarter bottomline plunging 35 per cent on India price war.

With protests in Hong Kong showing no sign of easing, most of the Hong Kong-based Jardine counters were among the main laggards on the benchmark index.

Jardine Strategic Holdings closed US$0.95 or 2.9 per cent lower at US$32.00, Jardine Matheson Holdings ended down US$1.23 or 2.2 per cent at US$53.85, and Hongkong Land finished US$0.05 or 0.9 per cent lower at US$5.40.