Sep 02, 2016

    Stocks in the red as all eyes on US jobs report

    SINGAPORE shares found no reprieve yesterday, finishing weaker for a fourth straight day ahead of a key United States jobs report.

    The local Straits Times Index lost 4.12 points, or 0.15 per cent, to 2,816.47.

    Some 987.1 million shares worth $851.3 million changed hands.

    Markets elsewhere in Asia were a mixed bag. A report showing China's factory activity last month climbed to its highest in two years sent Hong Kong up 0.81 per cent.

    But Shanghai retreated 0.72 per cent, likely dragged down by worries that the authorities will hold off fresh stimulus measures. Tokyo grew 0.23 per cent while Sydney pared 0.32 per cent and Jakarta fell 0.91 per cent.

    Wall Street eased 0.29 per cent overnight as investors braced themselves for the upcoming non-farm payroll report, to be released tonight US time - which could offer hints as to when the next rate hike will take place.

    "I think the market is coming to grips with a higher probability that the Fed may move in September," Robert Pavlik, who helps oversee US$9.1 billion (S$12.4 billion) as chief market strategist at Boston Private Wealth, told Bloomberg.

    "A possible Fed rate hike creates some near-term worries - that's what you're seeing play out."

    Of the 30 STI constituents, nine rose, 13 fell and eight were flat. Singtel sank five cents or 1.2 per cent to $3.97 in heavy trade. Palm oil giant Golden Agri-Resources also shaved off half a cent or 1.4 per cent to 35.5 cents while airport services firm Sats slid six cents or 1.3 per cent to $4.65.

    Singapore Airlines was among the biggest gainers, advancing 12 cents or 1.1 per cent to $10.62, after posting losses since Monday.

    OCBC Investment analyst Eugene Chua said: "If Zika virus continues to pose problems in Singapore over a prolonged period, inbound and outbound traffic will likely be hit." But he added it is still too early to determine any impact, maintaining a "hold" call on the stock with an unchanged fair value of $11.56.

    Outside of the blue chips, content producer mm2 Asia rose 1.5 cents or 1.9 per cent to 79 cents, after proposing a one-into-two share split.

    It said the share split will help increase its market liquidity while broadening its shareholder base.