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Singapore stocks: STI resumes Wednesday afternoon trading, down 0.1% on day

SINGAPORE equities resumed trading on Wednesday afternoon with slight losses, with the Straits Times Index (STI) down 4.17 points or 0.1 per cent to 3,015.39 as at 1.04pm.

Overnight, the US Federal Reserve announced an emergency rate cut of 50 basis points to boost confidence in the economy in the wake of the Covid-19 outbreak. The move by the central bank surprised markets, which were expecting a cut at next week's March policy meeting instead.

The Fed may have been swift in reacting, but it seemed to roil rather than calm markets that the global economic fallout from the disease could be worse than expected.

Shortly after the afternoon session began, volume traded on the Singapore bourse clocked in at 787.2 million securities with a total turnover of S$871.5 million. Both volume and turnover are on track to beat their respective 2019 intraday averages.

Across the market, decliners trumped advancers 239 to 146. The bluechip index had half of its 30 counters trading in the red.

The local banks were the main laggards on the STI due to the effect Fed cuts will have on net interest margins.

DBS shares fell S$0.30 or 1.2 per cent to S$23.86, OCBC Bank lost S$0.14 or 1.3 per cent to S$10.51 while United Overseas Bank was trading at S$23.93, down S$0.34 or 1.4 per cent, as at 1.03pm.

Conversely, real estate investment trusts (Reits), which are key beneficiaries of reduced borrowing costs, outperformed the broader market.

CapitaLand Commercial Trust units jumped S$0.09 or 4.7 per cent to S$2.01, CapitaLand Mall Trust advanced S$0.10 or 4.3 per cent to S$2.44.

Mapletree Commercial Trust added S$0.07 or 3.3 per cent to S$2.20, while Mapletree Logistics Trust gained S$0.03 or 1.6 per cent to S$1.92. The latter of the two Mapletree Investments sponsored Reits was upgraded by UOB Kay Hian to "buy" with an increased target price of S$2.08.

Among agribusiness firms, Japfa shares gained 1.5 Singapore cents or 2.6 per cent higher at 59 cents. On Wednesday, DBS Group Research upgraded the mainboard-listed company to "buy" and raised its target price to S$0.84 after a strong Q4 performance.

The research house also noted that Japfa is on the cusp of recovery and expects performance to be stable moving forward.

Elsewhere in the Asia-Pacific, equity benchmarks were mixed with Australia, China and Hong Kong lower. Meanwhile, Malaysia, South Korea and Taiwan were up.