Shares dip as punters rest after post-Brexit rally
SINGAPORE shares ended slightly in the red yesterday as investors decided to take a breather from a recent rally.
It was a similar scene across the region, with most Asia Pacific bourses coming off from their highest levels in months.
The local benchmark Straits Times Index fell 9.22 points, or 0.31 per cent, to 2,919.54.
"The market is taking a pause," Tony Farnham, a strategist at Paterson Securities in Sydney, told Bloomberg.
"There isn't much of a catalyst out there. People are starting to question if there's still value in the market following the post-Brexit rally."
While Tokyo rose 1.4 per cent, Hong Kong dropped 0.6 per cent, Shanghai slipped 0.2 per cent, Sydney dipped 0.1 per cent and Seoul edged down 0.2 per cent.
Columbia Threadneedle Investments' global head of equities, Mark Burgess, wrote in a note to clients yesterday that the rally was likely due to the appointment of Theresa May as Britain's new prime minister.
This added some certainty and calm to the markets which boosted investor confidence.
However, he added, the rally felt "somewhat unjustified and unsupported by the fundamentals".
After all, there will be headwinds facing the British economy as it detaches itself from the European Union, he noted. "Moreover, at some stage, we are going to have to contemplate the possible impact on the broader economy of the United States election result, while disharmony could yet break out within the European Union."
Commodity plays in Singapore were hit by the sell-off, with Noble Group down 0.6 cent to 16.7 cents, Golden Agri-Resources falling half a cent to 35.5 cents, Olam International slipping 1.5 cents to $1.845 and Indofood Agri losing half a cent to 47 cents.
Wilmar International was flat at $3.35.
Thai Beverage was one of the top actives yesterday, rising 2.5 cents to 98.5 cents.
OCBC Investment Research noted yesterday that Thai Beverage's 79.66-per cent owned subsidiary Oishi Group has said the ready-to-drink green tea market contracted 5 per cent in 2014 and 2 to 3 per cent last year.
Keppel DC Reit gained 1.5 cents to $1.185, after announcing on Monday that its distribution per unit rose 3.1 per cent in the second quarter from a year ago, to 1.67 cents.