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Singapore shares slump 1.5% on afternoon session sell-off
US President Donald Trump's dour comments on China prior to the conclusion of trade talks in Shanghai - meaning low expectations of progress between the two countries - were met ahead of the Federal Reserve's widely anticipated rate cut, making for a sub-par session in Asia.
Moreover, investors exiting positions ahead of the Fed's month-end meeting and weak trade in Hong Kong also contributed to a session that saw the Straits Times Index (STI) slide 49.79 points or 1.5 per cent to end July at 3,300.75. The STI dropped 1 per cent during the first half of the afternoon session, as did MSCI Singapore futures during that period.
Dealers mostly attributed the drop to investors exiting positions to close the month out.
Elsewhere in the Asia-Pacific, shares in Australia, China, Hong Kong, Japan, Malaysia and South Korea also closed lower.
Hong Kong's markets, already feeling the effects of eight weekends of protests on the territory's economy, had to close early for the first time in nearly two years due to an approaching storm. The Hang Seng lost 1.3 per cent in the shortened session.
In Singapore, trading volume clocked in at 1.15 billion securities, 96 per cent of the daily average in the first six months of 2019. Total turnover came to S$1.73 billion, 63 per cent over the January-to-June daily average.
Across the broader market, decliners beat advancers 294 to 150. Meanwhile, the blue-chip index had 28 of its 30 components closing in the red.
Genting Singapore, which dropped 0.5 Singapore cent or 0.5 per cent to S$0.92, was the benchmark index's most traded stock with 42.3 million shares changing hands. The casino operator will be reporting results for the second quarter ended June 30 after market close on Friday.
The local banks all ended lower. DBS Group Holdings was S$0.08 or 0.3 per cent lower at S$26.41, OCBC Bank fell S$0.17 or 1.4 per cent to S$11.54 and United Overseas Bank closed at S$26.40, down S$0.40 or 1.5 per cent.
Remisier Ernest Lim said: "Some blue chips such as the banks have risen quite a bit in anticipation of good results. As such, it is quite normal for investors to take profit, especially at month's end."
Among key second-line performers, Sheng Siong shares continued to garner the attention of investors after posting a better-than-expected Q2 performance. The supermarket operator, which plans to pay out a higher dividend for the April-to-June period, bucked the local trend to finish S$0.01 or 0.9 per cent up at S$1.16.
Research houses have mostly maintained or upgraded their recommendation on the stock to "buy" while raising their target price on the earnings surprise.