Aug 13, 2014

    Local stocks slip on profit-taking

    IGNORING positive leads from Wall Street and Europe, local shares ended a tad lower yesterday on profit-taking.

    Several blue-chip heavyweights came under pressure despite easing geopolitical tensions and somewhat better than expected second-quarter economic growth figures at home.

    The benchmark Straits Times Index shed 3.06 points to 3,303.39, with 1.54 billion shares worth $736.7 million changing hands.

    Among the top five active stocks were OCBC Bank, which shed 0.9 per cent or nine cents to $10.14 a share, with 4.39 million shares changing hands, and SingTel, which dropped 0.5 per cent or two cents to $3.92, with 7.47 million shares changing hands.

    Food and beverage counter Envictus International was the leading laggard, with a 66 per cent plunge in its price after the stock went ex-dividend yesterday.

    The company last week proposed a special interim dividend of 30 cents per share, payable on Aug 26.

    Formerly known as Etika International, Envictus ended at 14.8 cents, down 29.2 cents, with 7.5 million shares changing hands.

    Bucking the downtrend, DBS Group Holdings gained eight cents to $18.04 with 2.6 million shares changing hands, while United Overseas Bank rose 0.5 per cent or 12 cents to $22.75, with 1.5 million shares changing hands.

    Stratech Systems shares jumped 10 per cent or 0.2 cent to 2.2 cents, on speculation that the company may be removed from the Singapore Exchange watchlist after it posted net profit for three straight quarters from the third quarter of 2014. Some 38.4 million shares changed hands.

    The IT and advanced technology systems developer has been on the watchlist since June 5 last year.

    It said in a statement yesterday that its first-quarter 2015 - ended June 30 - earnings returned to the black with $0.88 million, against a net loss of $1.98 million a year ago. Its net assets stood at $6.84 million as at June 30.

    Meanwhile, Singapore said its economy grew faster than previously estimated in the second quarter, by 2.4 per cent from a year earlier, or 0.1 per cent on-quarter, against an expected contraction of 0.8 per cent.

    But HSBC said yesterday: "The upward revision primarily reflected less drag from the manufacturing sector, although the sequential contraction there still remained relatively sharp."

    The bank went on to warn that growth will likely remain subdued in the second half of the year, mostly due to wage pressures and a government-led restructuring of Singapore's economy towards higher value-added industries.

    "To be sure, Singapore may experience a lift in external conditions in the second half," HSBC said. "But overall growth will remain constrained by the structural rebalancing process."