STI falls 0.4%, snaps three days of gains on back of US inflation jitters

SINGAPORE shares closed lower on Wednesday, snapping three straight days of gains following an overnight pullback in Wall Street, as the release of hot inflation data fuelled expectations that the US central bank could tighten monetary policy sooner.

The key Straits Times Index fell 13.66 points or 0.43 per cent to finish at 3,153.15 on Wednesday.

Key gauges of major Asia-Pacific markets were awash in a sea of red. Japan fell 0.4 per cent; Hong Kong and Malaysia were down 0.6 per cent and 0.5 per cent respectively; and China retreated more than 1 per cent.

Advance estimates from the Ministry of Trade and Industry (MTI) indicated that the Singapore economy expanded by a robust 14.3 per cent year on year in the second quarter, largely owing to the low base last year, while it contracted sequentially as a result of the tightening measures between May and June, which were imposed to curb a wave of new cases of Covid-19. For H1, gross domestic product (GDP) growth reached 7.4 per cent year on year.

While the latest data reveals some unevenness in the recovery across sectors, analysts expect the accelerated vaccine roll out and further re-opening to support the city state's economic rebound.

Turnover in the local bourse came in at 1.58 billion units worth S$1.02 billion. Losers outnumbered gainers, with 257 counters down and 208 up. DBS led the losses in the local bourse, falling 31 Singapore cents or 1.02 per cent to S$30.02.

Oil-linked counters from Rex International to Sembcorp Marine and RH Petrogas, to name a few, were some of the day's most actively traded amid a rally in crude prices following a warning by the International Energy Agency (IEA) of a "deepening crude supply deficit."

Oil prices pared the gains during the Asian session however, underscoring the volatility as the oil cartel and its allies have yet to reach an agreement on future output.

RH Petrogas, an upstream oil-and-gas firm, rose 0.9 Singapore cent or 5.14 per cent to finish at 18.4 Singapore cents.

Entertainment group mm2 Asia tumbled 11 per cent to 7.2 Singapore cents on news that its independent auditor noted a material uncertainty regarding the group's ability to continue as a going concern.

CNMC Goldmine Holdings inched up 0.5 Singapore cent or 2.4 per cent to 21.5 Singapore cents. The gold miner said late on Tuesday that its subsidiary gained the green light from the Malaysian authorities to resume mining operations at its flagship Sokor gold mine in Kelantan. Its counter had fallen to a 52-week low of 20 Singapore cents on Monday.