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S'pore shares pare losses to close down 0.8% on China's yuan moves
SINGAPORE stocks continued to take a beating on Tuesday as escalating US-China trade tensions rattled investors, but pared back early losses after Beijing moved to stabilise the yuan.
The Straits Times Index dropped as much as 1.6 per cent, a nearly two-month low, but regained ground steadily over the session to close at 3,170.47, lower by 24.04 points or 0.75 per cent.
Losers outnumbered gainers 318 to 135, or about two stocks down for every one up. A total of 1.30 billion shares worth S$1.64 billion were traded.
"Who doesn't love a good old Turnaround Tuesday story in the markets?...We have the PBOC (People's Bank of China) to thank for tweaking the fix just enough to convince the markets mainland authorities are not embarking on a wave of aggressive yuan depreciation," said Stephen Innes, managing partner at VM Markets.
China's central bank took steps to limit weakness in the yuan after the currency fell to its lowest level against the dollar since August 2010 on Monday, prompting US President Donald Trump to label China a currency manipulator in a tweet.
"The PBOC had the fixing stronger than seven to correct herding behaviour yesterday," said Stephen Chiu, a strategist at Bloomberg Intelligence. "It's a message to the US - we aren't manipulating the currency weaker. If markets drive dollar-yuan rate even higher and out of hand, I don't think the PBOC will sit there doing nothing."
Singapore's benchmark was dragged by industrials and financial stocks on Tuesday. Conglomerate Jardine Matheson Holdings fell 0.89 per cent or US$0.51 to US$56.87, while Jardine Cycle & Carriage lost 3.81 per cent or S$1.24 to S$31.31.
DBS Group and UOB were also among the bourse's largest decliners. DBS closed at S$24.88, down 1.62 per cent or S$0.41, while UOB finished 0.97 per cent or S$0.25 lower at S$25.66.