STI falls 0.85% as traders snub upbeat macro data

SINGAPORE shares closed lower on Wednesday, as worries over the surge in Delta variant cases in many countries persisted and the guesswork on the timeline of the US Federal Reserve's tightening continued.

The key Straits Times Index (STI) fell 27.36 points or 0.85 per cent to 3,180.00.

Investors in the local bourse shrugged off encouraging macro data released by Singapore - that its GDP rose 14.7 per cent in the second quarter on an annual basis, which led to a significant official upgrade in the 2021 growth forecast.

Jeffrey Halley, senior Asia-Pacific market analyst at Oanda, attributed Wednesday's losses to profit-taking, chiefly in banking stocks. "Singapore Q2 GDP... has caused barely a flutter in the city-state. If anything, it has provoked some profit-taking among Singapore banking stocks, pushing down the STI," he said. He also pointed out that the latest growth data predates the virus lockdowns that have "marred" the third quarter and "will undoubtedly impact those numbers".

Major Asian gauges closed mixed the day ahead of key US inflation data. China's Shanghai Composite finished marginally higher; Hong Kong's Hang Seng gained 0.20 per cent. Japan rose 0.7 per cent, Malaysia rallied 0.5 per cent, while Australia continued to ignore the lockdowns and climbed 0.3 per cent. South Korea and Taiwan fell 0.7 per cent and 0.6 per cent respectively.

Some cheer across the region came from US President Joe Biden's massive US$1.2 trillion infrastructure spending bill, which finally passed.

In the local bourse, turnover came in at 1.31 billion units worth S$1.09 billion. Losers outpaced gainers, with 265 counters down and 240 up. All three banks led losses, shaving some 16 index points off the STI.

Centurion Corp added 1 Singapore cent or 3.03 per cent to 34 Singapore cents. The mainboard-listed accommodation provider reported a 58 per cent fall in profits to S$8.7 million on the back of a 3 per cent drop in revenue to S$64.7 million. This was largely a result of a decline in student accommodation revenue.

Koufu Group rose 2 Singapore cents or 3.08 per cent to 67 Singapore cents. Higher footfall at its food outlets and a newly-acquired business drove Koufu's H1 net profit to S$9.9 million, almost quadruple the figure from a year ago, the mainboard listed firm announced on Tuesday after the market close.