Oct 29, 2014

    Jittery markets slip ahead of Fed meeting's outcome

    INVESTORS nervously awaiting the outcome of a United States Federal Reserve meeting sold down their stocks yesterday, leaving the Singapore market in the red.

    The Fed, which met last night, is expected to announce whether it will end its US$15 billion (S$19 billion) monthly bond-buying programme or extend it, given a recent slew of mixed data about the state of the US economy.

    It is also expected to give clues as to when it might start raising interest rates from record lows.

    The benchmark Straits Times Index fell 14.46 points, or 0.45 per cent, to end at 3,211.65.

    The jittery anticipation was seen elsewhere in the region, with Tokyo slipping 0.38 per cent, Sydney shedding 0.12 per cent and Seoul retreating 0.33 per cent.

    However, Hong Kong gained 1.63 per cent and Shanghai surged 2.07 per cent as bargain hunters swooped in after Monday's sell-off.

    Noble Group was among the top actives at home, closing six cents lower at $1.185, after falling as much as 10 per cent earlier in the trading session.

    The volume of Noble shares changing hands approached three times the daily average over the past three months.

    The jump came as China Investment, Noble's second-largest shareholder, sold some of its 13.8 per cent stake in the company last month.

    But yesterday's share-drop is unlikely to be related to changes in the company's operations or markets, Jefferies analyst Abhijit Attavar told Bloomberg.

    "As far as we know, there's no change in the company's fundamentals, but their results are coming up soon and they're always a wild card." Noble is due to report its third-quarter financial results after the market closes on Nov 7.

    Raffles Medical Group dropped five cents to $3.88. The company said on Monday that its net profit for the third quarter was up 11 per cent.

    CIMB Research analyst Gary Ng yesterday reiterated his "add" rating on the stock, saying the company's ongoing expansion plans in China would translate into earnings growth for many years.

    CDL Hospitality Trust slipped 1.5 cents to $1.68, after saying its third-quarter distribution per unit fell 1.1 per cent to 2.61 cents.

    "With headwinds facing both the demand and supply side of the tourism industry not abating, we see limited growth prospects over the next two years for this stock," wrote DMG & Partners analyst Ivan Looi in a note yesterday. He has a "neutral" call on the trust.

    Hutchison Port Holdings Trust fell 1.5 cents to 86 cents. It said on Monday that third-quarter net profit slipped 9 per cent.