STI slips 0.55% as region turns into a sea of red on possible greater rate hikes

SINGAPORE shares joined its counterparts in the Asia Pacific region to close in the red on Thursday (Apr 7), after the United States central bank's minutes released overnight suggested that greater interest rate hikes are on the cards.

The Straits Times Index (STI) was 18.72 points or 0.55 per cent lower at 3,404.23 points. Oanda senior market analyst Jeffrey Halley said: "Asian equity markets are lower today as it follows Wall Street south, digests the implications of a faster tightening Federal Reserve, and casts a nervous eye over China and its virus situation."

The Federal Open Market Committee minutes showed that there might be a faster pace of reducing its bond holdings, targeting US$95 billion per month from September, easing into the process from next month. The minutes suggested that the Federal Reserve might also jack up interest rates in 0.5 percentage-point steps from next month if inflation stays high.

Sembcorp Industries shares closed 5.90 per cent higher to S$2.87, making it the top STI performer, but it also drew queries from the bourse regulator Singapore Exchange on the "unusual price movements". Two-thirds of STI counters were in the red, with Mapletree Logistics Trust being the top loser as the real estate investment trust slid 1.60 per cent to S$1.84.

The most active counter was Sembcorp Marine , with some 230.4 million shares traded and closed 4 per cent up at S$0.104. The firm has been hogging the top position since it gave notice last week on 3 consecutive years of pre-tax losses but later announced that "significant progress" has been made in the proposed merger with Keppel Offshore & Marine.

Decliners beat gainers 244 to 187 in the broader market on a turnover of 1.31 billion with a total value of S$1.25 billion.