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Singapore shares fall 0.3% on Brexit woes, US-China worries

REMINDED of global growth concerns, US-China issues, as well as doubts over a Brexit deal, investors were given a dose of reality, which made for a cautious session in Asia.

But there could be some upside for equities on Friday as UK Prime Minister Boris Johnson announced at the close of the Asia session that a new Brexit deal with the European Union has been reached. But the deal will still need Westminster's approval.

On Thursday, the Straits Times Index (STI) trended lower as the session went on, ending at 3,126.14, a drop of 8.57 points or 0.3 per cent. Among other Asia-Pacific indices, Australia, China, Japan and South Korea also closed in the loss column. Malaysia ended flat.

Bucking the trend was the Hang Seng Index, which closed at a one-month high. Sentiment among traders in the territory was boosted as major lenders agreed to adopt measures to support businesses.

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Among global concerns, Wednesday's surprise drop in September's US retail sales raised questions about the strength of US consumers in sustaining growth in the world's largest economy. At home, non-oil domestic exports (NODX) continued to dip, with September's reading an 8.1 per cent year-on-year fall due to lower exports to the US, Europe and Japan. That said, it was an improvement from the reading of the six months prior.

In Singapore, trading volume stood at 832.95 million securities, 71 per cent of the daily average in the first nine months of 2019. Meanwhile, total turnover clocked in at S$924.14 million, 87 per cent of the January-to-September daily average.

Across the market, decliners trumped advancers 226 to 159. Eighteen of the blue-chip index's 30 counters ended in the red.

Led by City Developments Limited (CDL), property plays were the main bright spots on the STI.

CDL advanced S$0.51 or 5.2 per cent to close at S$10.39. "Performance was probably helped by two bullish equity research reports on the company," one trader remarked. Citi Research expects CDL to "unlock value" in the coming years, following the recent privatisation of Millennium & Copthorne Hotels (M&C) through "performance optimisation, redevelopment and divestments". The stock remains the research house's top pick among Singapore developers.

Mapletree Commercial Trust (MCT), which is trading on a cum dividend and cum rights basis, added four Singapore cents or 1.7 per cent to S$2.38.

On Wednesday, MCT proposed an equity fundraising comprising 406.5 million new units to raise at least S$902.3 million to partially fund the S$1.55 billion acquisition of Mapletree Business City (Phase 2). The real estate investment trust (Reit) on Thursday priced private placement units at S$2.28 per new unit, while preferential placement units were offered at S$2.24.

It was a mixed picture for Singapore's bellwether banking trio. DBS Group Holdings dipped S$0.11 or 0.4 per cent at S$24.94 and OCBC Bank edged down one Singapore cent or 0.1 per cent to S$10.85. Meanwhile, United Overseas Bank closed at S$26.02, up two cents or 0.1 per cent.