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STI posts slight losses ahead of New Year's Eve

UNLIKE its Wall Street counterparts on Friday, equities in Asia continued to have a relatively quiet (but mixed) session ahead of the New Year.

"Asian markets are stubbornly refusing to join in the last gasp trade euphoria prevalent on Wall Street," wrote Oanda Asia-Pacific senior market analyst Jeffrey Halley to clients. 

He added: "The overall picture is one of book squaring and profit-taking in Asia with investors preferring to wait until next week before loading up on the first trades of a new decade."

On Monday, Singapore's Straits Times Index (STI) stayed mostly range-bound, ending the session at 3,222.44, down 4.09 points or 0.1 per cent.

Elsewhere in the Asia-Pacific, Australia, Japan, South Korea and Taiwan were lower. China, Hong Kong and Malaysia made gains.

Of the lot, the benchmarks in Greater China fared best after China's central bank on Saturday indicated it will use the loan prime rate (LPR) as a benchmark for pricing floating-rate loans. It could lower loan costs, thereby encouraging economic growth.

In Singapore, trading volume clocked in at 1.35 billion securities, 13 per cent over the daily average in the first 11 months of 2019. Total turnover came in at a muted S$654.78 million, 61 per cent of the January-to-November daily average, suggesting activity was driven by pennies. 

Advancers trumped decliners 234 to 169. Fourteen of the benchmark's 30 counters ended in the red.

Singtel shares edged up S$0.01 or 0.3 per cent to S$3.38 after revealing a tie up with ride-hailing and fintech firm Grab to apply for a digital full bank licence in Singapore. The telco will hold a 40 per cent stake in the consortium with Grab holding the remaining 60 per cent.

Golden Agri-Resources continued to see heavy activity since being dropped from the STI on Dec 23. It closed unchanged at 23.5 Singapore cents with 71 million shares changing hands.

Last week, institutional investors were top net buyers of the agribusiness player, while retail investors were top net sellers. Recent interest has also been supported by increases in crude palm oil prices, which are headed for the best performance in a decade.

AEM Holdings jumped S$0.10 or 5.3 per cent to S$1.99 after the provider of advanced chip testing solutions acquired French test solutions provider Mu-TEST for 7.5 million euros (S$11.3 million).

Among penny stocks, Mermaid Maritime saw considerable activity, jumping 3.6 Singapore cents or 31.3 per cent to close at 15.1 cents. The 103.9 million shares traded was the most on the Singapore bourse.

Investors could be making a play for the provider of engineering services to offshore oil and gas firms on the back of higher oil prices, one dealer said.

CGS-CIMB head of Singapore research Lim Siew Khee recently said Mermaid could be a potential privatisation candidate. The stock was trading at 0.34 times price-to-book, and its controlling shareholder has sufficient debt headroom to privatise, she wrote in a Dec 9 strategy report.