S'pore shares fall amid China jitters
LOCAL equities took another hammering yesterday, amid continued volatility in the region following China's surprise move last week to devalue its currency.
The benchmark Straits Times Index (STI) fell 46.9 points, or 1.51 per cent, to 3,067.35.
The weak sentiment here - little helped by a poor showing in the latest non-oil domestic export data - mirrored that in Hong Kong, where the Hang Seng Index fell 0.74 per cent.
Traders continued to anticipate more strain on the currency, despite attempts from the Chinese central bank to soothe market jitters.
"We believe the yuan will still face further depreciation pressure as the weak economic environment warrants further monetary easing measures, while the United States interest-rate hike is likely to come as soon as next month," said Alex Fan, a research director at GF Securities.
Mainland Chinese stocks had a respite, with the Shanghai Stock Exchange Composite Index rising 0.72 per cent after the central bank gave assurance that there was no further basis for depreciation in the currency.
At home, commodities blue chip Noble Group was among the day's biggest losers as it continued to buckle, sliding 3.5 cents or 7.14 per cent to 45.5 cents.
The counter was the day's most heavily traded, with 78.2 million shares changing hands.
CMC Markets analyst Nicholas Teo noted that trading restrictions placed on the stock by certain brokers could have been part of the push behind the selldown.
Local lenders fared poorly as well: United Overseas Bank (UOB) dropped 70 cents or 3.4 per cent to $19.88, DBS Group lost 48 cents or 2.49 per cent to $18.78 and OCBC Bank pared 16 cents or 1.64 per cent to $9.60.
Offshore support services firm Ezion Holdings stood out with a 6.5 cent or 8.97 per cent plunge to 66 cents, against a persistently bleak outlook for oil prices.
KGI Fraser Securities noted that the firm's second-quarter performance - net profit fell 36.3 per cent to US$28.96 million (S$40.8 million) from a year earlier - was below expectations. It put out a "sell" call on the stock, citing deteriorating fundamentals and possible oversupply.
Bourse operator Singapore Exchange was one of the few bright spots in the market, climbing 5 cents or 0.661 per cent to $7.62, while Thai Beverage rose 0.5 cent or 0.654 per cent to 77 cents.
Elsewhere in the region, Japan's Nikkei 225 Index climbed 0.49 per cent despite a contraction in its economy, echoing the positive sentiment in Wall Street last Friday.
IG market strategist Bernard Aw expects attention to be on the next set of minutes from the Federal Reserve policy meetings, set to be released tomorrow.
"Markets are still quite divided on the probability of a rate hike by the Fed in September, so the minutes as well as the US inflation data may provide some clarity for market speculators," he said.