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STI drops 3.44% with Asia's key bourses
IT WAS a sea of red for Asia's key stock indices, and Singapore's Straits Times Index (STI) was not spared. The STI dropped 3.44 per cent or 96.36 points to 2,704.21 points on Thursday.
All but one out of the 30 STI constituents closed lower; the exception was Singapore Press Holdings, publisher of The Business Times, the shares of which rose one Singapore cent to S$1.36.
Australia's S&P/ASX 200 index fell 3.05 per cent to 5,960.64, snapping a seven-session winning streak. Japan's Nikkei 225 suffered its biggest one-day fall in six weeks, down 2.82 per cent to 22,472.91. Hong Kong's Hang Seng index dropped 2.27 per cent to 24,480.15, while China's Shanghai Composite index was 0.78 per cent lower at 2,920.90. The FTSE Bursa Malaysia Kuala Lumpur Composite Index was down 1.14 per cent to 1,557.25.
The dismal showing by the regional bourses came after the US central bank gave a dour economic outlook the night before. The Federal Reserve forecast the US economy would contract 6.5 per cent this year. Its chair Jerome Powell emphasised the recovery would be a long road and that policy would have to be proactive with rates near zero out to 2022.
The three local banks' shares slipped by between 33 cents and 91 cents. DBS Equity Research thinks that there will be profit taking on banks following their recent strong run and after the Fed reiterated a lower-for-longer interest rates stance.
United Overseas Bank (UOB), which goes ex-dividend (S$0.55 final and S$0.20 special) next Monday, shed 2.42 per cent to end at S$22.54. OCBC Bank's was 3.39 per cent lower at S$9.40, and DBS shares slipped 3.95 per cent to S$22.15.
The most heavily traded STI stock was Singtel, which declined eight Singapore cents to S$2.57, with 55.8 million shares cum-dividend having changed hands.
Losers outnumbered gainers 386 to 140 for the day, with 1.95 billion shares worth S$2.21 billion traded.