Nov 07, 2014

    Market takes it easy after SGX disruption

    THE Singapore market flatlined yesterday in the wake of the massive trading disruption on Wednesday.

    The benchmark Straits Times Index eked out a gain of 3.3 points or 0.1 per cent to end at 3,290.96, propped up by optimism on Wall Street overnight.

    The local market remains so moribund that some traders told The Straits Times yesterday that the shutdown on Wednesday failed to register at first.

    "It took almost 20 to 30 minutes before we noticed the disruption, since there had been little or no fluctuations on the trading screen before that anyway. That's how quiet the market is," remisier Charles Chua told The Straits Times.

    The Singapore Exchange (SGX) said yesterday that Wednesday's nearly three-hour shutdown was caused by back-up power system malfunctions.

    Still, trading volume rebounded yesterday to 1.44 billion shares worth $1.1 billion, up from Wednesday's 817 million shares worth $692 million.

    Markets across Asia were also mostly muted yesterday. Hong Kong shed 0.2 per cent in its fourth straight day of losses, while Shanghai and Seoul both gained 0.3 per cent. Tokyo's Nikkei, however, dropped 0.9 per cent partly due to a decline in Japanese banks.

    That was despite an overnight rally in the United States. Investors snapped up US stocks hoping that the Republicans, who have gained control of the Senate, will put in place more business-friendly policies.

    That strong lead from Wall Street offset some nervousness after the SGX glitch on the part of local investors yesterday, some of whom had said that they planned to avoid trading for a while following the glitch.

    All eyes are now on the release of US jobs data later today, which could influence when the Federal Reserve raises interest rates.

    In Singapore, stubbornly low oil prices weighed on the market. Saudi Arabia, the world's biggest oil producer, recently slashed oil prices in an attempt to prevent US shale gas producers from gaining market share.

    Transport stocks did well. SBS Transit jumped 5 per cent or eight cents to $1.68 while ComfortDelGro was up 10 cents or 3.9 per cent to $2.68.

    However, rig builders continued to suffer. Sembcorp Marine, which has been battered by falling oil prices, lost nine cents to $3.59 yesterday despite posting slightly higher third-quarter earnings the day before. Keppel Corp dipped six cents to $9.43.

    A few large property developers also declined yesterday as the property market languishes.

    Keppel Land fell nine cents to $3.27 and CapitaLand shed six cents to close at $3.12. Wing Tai also dropped seven cents to end the day at $1.71.