Jun 22, 2016

    Punters lie low ahead of Brexit poll

    BREXIT jitters continued to hit Singapore shares, forcing investors to sit it out until the outcome of tomorrow's referendum is known.

    The Straits Times Index closed down 0.41 per cent or 11.42 points to 2,789.45, weighed down by Singapore Press Holdings, which dipped 1.8 per cent or seven cents to $3.78, and Singtel, down 0.3 per cent or one cent to $3.84.

    About 835.4 million shares worth $730.3 million changed hands.

    Market watchers say the British poll is too close to call.

    "It's a 50-50 per cent chance of going either way. If the outcome is to leave the European Union, equity markets will likely react negatively. Still, we expect the STI to hold up at around the 2,700 level," according to DBS Group Research.

    "A financial contagion is not feared, and investors will be looking at central banks to... stem any potential panic," DBS said. A stay vote should see the STI rebound towards 2,900, with banks and rig builders that have lost ground in recent weeks leading the charge, it added.

    Companies with earnings exposure to the British pound, such as City Developments, ComfortDelgro and SembCorp Industries, will be more sensitive.

    Defensive and yield stocks, including telco M1, ST Engineering and supermarket chain Sheng Siong could outperform if Britain votes to leave, DBS said.

    Frasers Logistics and Industrial Trust made its debut at 90.5 cents yesterday, closing at 91 cents, above its 89 cents a share offering. Dealers attributed the strong debut in a jittery market to its attractive yield and strong institutional investor interest. More than 140.2 million shares were traded.

    "This is one of the higher profile IPOs in months, and strong institutional interest resulted in the stock being oversubscribed about six times," KGI Fraser Securities trading strategist Nicholas Teo said.

    Pennies were the most actively traded, with Ezra Holdings falling 1.3 per cent or 0.1 cent to 7.7 cents.

    Noble Group gained 4.7 per cent or one cent to 22.5 cents, with 69.6 million shares traded. Loyz Energy fell 13.3 per cent or 0.4 cent to 2.6 cents, on trade of 42.9 million shares.

    ISR Capital jumped 12.2 per cent or 1.1 cents to 10.1 cents, with 19.8 million shares changing hands.