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Singapore shares hit 4-month low on Thursday as slump continues

THE Singapore market resumed its slide on Thursday, hitting a four-month low as investors remain gripped by concerns that US-China trade tensions were spilling into the technology sector.

Singapore's Straits Times Index (STI), which opened 0.5 per cent down, continued to tread lower as the session went on, before settling at 3,160.72, down 22.42 points or 0.7 per cent. While the benchmark index has given up most of its gains from the year's rally, it is still up 91.96 points or 3 per cent in 2019.

"With the US-China trade war baring its teeth, it's becoming clear that at the heart of it all is a technology war," a trader told The Business Times.

Observers said that while the base case was for a resolution to the trade impasse, delays are expected.

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On Wednesday, US Treasury Secretary Steven Mnuchin said that it would take at least a month before the US would enact proposed tariffs on US$300 billion in Chinese imports, signs that investors should not pin too much hope on a resolution soon.

Regional markets Australia, China, Hong Kong, Japan, Malaysia and South Korea closed lower. India and Indonesia markets posted gains, buoyed by local political developments.

In Singapore, trading volume clocked in at 989.19 million securities or 78 per cent of the daily average in the first four months of 2019. Total turnover came to S$1 billion, just under the January-to-April daily average.

Across the market, decliners outpaced advancers 292 to 138. The benchmark index had 26 of the STI's 30 components trading in the red.

Among them, Yangzijiang Shipbuilding was the benchmark index's most traded stock, with 29 million shares changing hands. The shipbuilder closed three Singapore cents or 2.1 per cent lower at S$1.38. 

Local tech counters faced steep sell-offs on Thursday, with the US-China tech tussle worrying investors who are concerned about ramifications on global tech supply chains. AEM Holdings skidded six Singapore cents or 6.5 per cent to end at S$0.87. Hi-P International finished eight cents or 6.6 per cent lower at S$1.14 while Venture Corp dropped S$0.46 or 3 per cent to S$14.97.

Among the bright spots was precision and motion-control engineering firm ISDN Holdings, which advanced one Singapore cent or 4.7 per cent to 22.5 cents.

On Wednesday, CGS-CIMB initiated coverage on ISDN with an "add" call and a target price of S$0.32, with analyst William Tng expecting the mainboard-listed company to benefit from "immense opportunities" from the fourth industrial revolution.

While the market was awash in a sea of red, some real estate investment trusts were among the local bourse's gainers. Frasers Centrepoint Trust, which traded at a cum-dividend and cum-offer basis, closed three Singapore cents or 1.3 per cent higher at S$2.44. Manulife US Reit added 0.5 US cent or 0.6 per cent to end at 85.5 US cents.