STI falls 0.7% in three-day losing streak

SINGAPORE shares closed lower for the third straight day following overnight losses in Wall Street, on persistent worries over inflation and rising Covid-19 cases in many parts of Asia.

The key Straits Times Index (STI) fell 21.01 points or 0.67 per cent to finish at 3,123.26 on Wednesday.

Other key gauges in the region fared mix with Japan, Taiwan, South Korea and Australia posting losses while Hong Kong, China and Malaysia saw gains.

Markets appear to be paying little regard to the US Federal Reserve, which has maintained its easy monetary policy while downplaying inflation risks. Overnight, the more cyclical heavy weighted Dow Jones Industrial Average fell 1.4 per cent.

According to CMC Markets analyst Kelvin Wong, however, the sell-off in the cyclical spectrum of the US stock market has been overblown and was likely due to profit-taking activities rather than the start of a major risk-off domino effect.

According to Geoff Howie, SGX's market strategist, as a result of the decline in global tech shares, the STI has now emerged as the year's strongest APAC benchmark with a 9.8 per cent gain.

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Julius Baer's fixed income analyst for Asia Sok Yin Yong says given the ongoing battle against the pandemic in Asia which could delay the expected economic rebound, central banks in the region are likely to stay accommodative to support their economies.

Turnover on the local bourse came in at 1.54 billion units worth S$1.48 billion. Across the broader market, decliners marginally outpaced advancers 229 to 223. Losses were led by OCBC, UOB and Thai Beverage.

Golden Agri-Resources extended its gains on Wednesday, rising 1.5 Singapore cents or 5.77 per cent to 27.5 Singapore cents ahead of its quarterly performance update, which didn't disappoint. It was the day's second most active with 79.6 million shares worth S$22.2 million changing hands. After market close, the palm oil giant reported a net profit of US$41 million for the first quarter from a loss of US$95 million in the previous year, owing to a rally in crude palm oil prices.

Manulife US Reit retreated 0.5 US cent or 0.7 per cent to 73.5 US cents. In a business update after Tuesday's trading, the Reit reported a healthy portfolio occupancy of 92 per cent for the first quarter ended March, above the US Class A average of 82 per cent. OCBC Investment Research has maintained a fair value estimate of 82 US cents on the counter, citing its resilient portfolio and that it would benefit from the US' economic rebound, among others.