Mar 11, 2015

    S'pore shares down amid 'Grexit' fears

    SINGAPORE shares ended lower yesterday, a touch below the critical 3,400-point support level for the Straits Times Index (STI).

    The fall was in line with weaker markets across Asia and a fast-strengthening dollar, ahead of a closely watched interest rate meeting of the Federal Open Market Committee, the United States Federal Reserve's policy-making arm.

    The STI shed 6.31 points to close at 3,398.26, with 1.15 billion shares worth $1.12 billion traded.

    Renewed fears of a "Grexit", or Greek exit from the euro zone, slowing the pace of the European Central Bank's (ECB's) quantitative easing programme also kept the STI in range-bound trade, remisier Alvin Yong said.

    The ECB's governing council is set to hold a special emergency teleconference meeting tomorrow on extending emergency liquidity assistance to Greek banks. Last month, the ECB cut off Greek banks from its funding after Athens abandoned its bailout programme, a condition for access to the ECB funds.

    A rallying US dollar reduces the likelihood of US hot money flowing to the Singapore market, he added. "There's a mad rush for US dollars and US dollar-denominated securities, and the Fed hasn't even raised rates yet."

    At home, Noble was again the most actively traded counter, plunging 6.5 per cent or 6.5 cents to 93.5 cents, with 75 million shares traded, while Genting Singapore dipped 2.6 per cent or 2.5 cents to 93.5 cents, with 43 million shares changing hands.

    "Noble is following the downtrend in share prices of Australia-listed Yancoal, its subsidiary," Mr Yong said. Iceberg had warned last week that the Singapore-listed commodity trader would have to make large further write-downs on the value of a 13 per cent stake in its unit, coal miner Yancoal.

    The strengthening greenback has put pressure on commodity prices in general, including that of coal, he added. Yancoal closed at 4.9 Australian cents, down from 64 Aussie cents (68 Singapore cents) a year ago.

    Penny stocks were back in the spotlight, with Ellipsiz up 3.7 per cent or 0.4 cent to 11.2 cents, with 44.7 million shares traded. The semiconductor services firm extended gains for a second straight session that it was not able to explain in response to Singapore Exchange queries.

    Ellipsiz had risen after UOB Kay Hian put a "buy" call on the company on Monday recommending that investors buy the stock based on a target price of 17.1 cents. The broker called Ellipsiz "an" for acquisition.

    Meanwhile, GSH Corp rose 1.33 per cent or 0.1 cent to 7.6 cents on news that Singapore billionaire Sam Goi will launch his firm's first property development by month-end. Some 17.9 million shares changed hands.

    The 28-storey office tower GSH Plaza, formerly known as Equity Plaza, in Cecil Street is in the midst of a soft launch, but about 100 of its 259 units will go on sale within three weeks. The units will range from 480 to 1,700 sq ft, with an average price of $2,850 to $3,500 per sq ft.