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Singapore shares fall 0.9% on Trump impeachment bid, trade tensions

SINGAPORE stocks marked their worst session in three weeks on Wednesday, as increased political turmoil in the US and trade tensions rattled investors.

The Straits Times Index (STI) ended in the red on Wednesday, slumping 0.6 per cent at the open before slipping further during the day to close at 3,125.82, down 0.94 per cent or 29.64 points.

"The benchmark STI has been drifting in ebbs and flows off foreign news this week, with overall sentiment leaning towards cautious mode," said Margaret Yang, an analyst at CMC Markets in Singapore.

Going forward, developments in the US-China trade negotiations, US President Donald Trump's impeachment inquiry and a softening global growth outlook are going to dominate trading for the rest of the week, she added.

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Overnight, US lawmakers had launched an impeachment inquiry into Mr Trump, adding to the trade worries weighing on investors' minds.

In addition, the US leader said at the sidelines of the United Nations General Assembly that he will not accept a "bad deal" with Beijing, ahead of planned talks between the two largest economies of the world.

"If an impeachment enquiry looks like ending his (Donald Trump's) re-election chances in 2020, he may throw caution to the wind and harden his attitude to a China trade deal, increasing the chances of a global recession next year," said Jeffrey Halley, senior market analyst, Asia-Pacific, at Oanda.

On Wednesday, losers outnumbered gainers 256 to 132 on the local bourse, or two down for every one on higher ground. Total turnover was S$967.82 million, with 989.81 million shares changing hands.

Industrial and financial stocks dominated losses, with conglomerate Jardine Matheson Holdings sliding 0.96 per cent or US$0.53 to US$54.67 and Jardine Cycle & Carriage slumping 2.1 per cent or S$0.65 to S$30.30.

This comes despite Jardine C&C's outgoing group managing director Alex Newbigging telling The Business Times that he is optimistic about Indonesia's automotive industry and sees "a lot of growth to come".

Singapore's largest lender DBS Bank dropped 1.24 per cent or S$0.31 to close at S$24.73, OCBC Bank fell 1.28 per cent or S$0.14 to S$10.77, while United Overseas Bank closed at S$25.38, shedding 0.7 per cent or S$0.18.

Much of the bourse's activity on Wednesday continued to be driven by Yangzijiang Shipbuilding and Golden Agri-Resources. The Chinese shipbuilder closed down 4.37 per cent or S$0.045 at S$0.985, on a volume of over 46 million shares. Golden Agri-Resources fared no better, tumbling 4.08 per cent or S$0.01 to S$0.235, with close to 26 million of its shares changing hands.